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UHIVCRSITY  ^ 

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AS   GOOD  AS  GOLD!, 

Ttii  U;i;..,>3IIY  LibrJARY 

l/NIVERSiTY  CF  CALIFCrNlA,  SAN  DIEG' 

LA  JOLLA.  CALIFORNIA 

A  National   Currency 


ISSUED    BY    AUTHORITY   OF    THE     PEOPLE;    BACKED    BY   THE   WEALTH 
OF   THE    nation;    BASED   ON 


A    Constitutional   Amendment. 


AND  CIRCULATED  FOR  THE  BENEFIT  OF  THE  PEOPLE;  UNDER 


A  National    Money  System 


IN    AMPLE   VOLUME    FOR   THE   BUSINESS   OF   OUR    GROWING    CIVILIZATION. 


AN    ADDRESS 

Before  the  Commercial  Congress  at  Kansas  City,  April  i6,  1891, 


By  R.  M.  WaDNEY,  LL.  D.  President 

OF   THE   UNIVERSITY  BANK  OF    LOS  ANGELES,  CALIFORNIA 


LOS  ANGELES: 

TiMES-MiKROE  Priming  and  Binding  House. 

1891. 


LIBRARY     ^ 


Either  our  circulating  lucdiuui  must  he  increased  suf- 
ficiently to  meet  the  ivants  of  our  groivino-  country,  or  the 
Imsiness  of  the  country  must  be  kitted  off  until  it  is  within 
the  compass  of  our  present  circulation' 


The  following  resolution  received  the  unanimous  vote  of  the  California 
Bankers'  Association  at  Los  Angeles,  March  13,  1891: 

Resolved,  That  this  convention  respectfully  request  Congress  at  its  next 
session  to  devise  a  uniform  money  system  for  the  people  of  the  United  States, 
with  the  gold  dollar  as  the  standard  or  unit  of  value  ;  using  gold,  silver  and  cur- 
rency for  a  circulating  medium,  in  a  sufficient  volume  to  fully  meet  and  keep  pace 
■with  the  growing  wants  of  the  business  of  the  country ;  founding  the  issue  of  cur- 
rency upon  the  wealth  of  the  whole  nation  ;  making  gold,  silver  and  currency  a 
legal  tender,  and  exchangeable  at  par  on  demand,  and  fixing  by  a  constitutional 
amendment  the  legality  of  such  a  circulating  medium,  and  preventing  the  dangers 
of  inflation,  contraction,  repudiation,  or  change  in  the  standard  of  value. 


The  most  critical  period  in  the  historij  of  the  present 
political  parties  that  has  arisen  since  the  luar  tjHI  occur  in 
the  next  session  of  Congress^  and  on  this  question  of  in- 
creased volume  of  money. 


H'~ 


AS  GOOD  AS  GOLD, 


Judge  E.  M.  WiDNEY,  President  of  the  University  Bank,  delegate  from 
Los  Angeles,  Cal,  addressed  the  Commercial  Congress,  at  Kansas  City, 
March  16,  1891  as  follows: 


Mr.  President  and  Gentlemen  of  this  Congress. 

The  owners  of  money  naturally  do  not  want  the  volume  increased. 
While  it  is  limited  they  can  control  the  rate  of  interest,  and  the  value  of 
all  labor  and  products,  and  can  dictate  the  price  of  all  property. 

A    CORNER    ON    MONEY. 

A  corner  on  railroad  rates  is  dangerous,  so  is  a  corner  on  wheat,  or  corn, 
or  cotton,  sugar,  wool,  or  on  any  of  the  staple  products.  But  of  all 
dangers  a  corner  on  money  is  the  worst.  A  corner  on  money  is  a  corner 
on  all  other  corners  combined,  and  can  control  the  social  and  political,  as 
well  as  the  producing,  labor  and  property  interests  of  the  nation.  The 
Rothschilds  recently  attempted  a  money  corner  on  Russia  to  control  its 
internal  policy  against  the  Jews.  Russia  in  retaliation  is  attempting  a 
corner  on  gold,  and  it  spreads  dismay  and  panic  among  the  nations. 

It  is  claimed  that  by  two  or  three  men  combining  in  New  York  they 
can  lock  up  enough  money  to  close  all  the  banks  in  that  city.  The  volume 
of  money  and  the  national  system  for  its  circulation  should  be  such  that 
no  corner  on  money  can  ever  be  possible. 

A   POLITICAL    FORECAST. 

The  most  critical  period  in  the  history  of  present  political  parties  that 
has  arisen  since  the  war  will  occur  in  the  next  session  of  Congress,  and 
on  this  question  of  the  increased  volume  of  money. 

Next  to  personal  rights,  no  question   afPects  the   voter  more   sensitively 

an  the  rights  of  property,  and  of  these  an  increase  in  the  volume  of 
money  is  most  important. 

The  political  party  that  offers  a  safe  increase  in  currency  to  relieve  the 
wants  of  the  people,  and  to  carry  on  the  business  of  the  nation  will  be 
offering  a  premium  for  every  vote.  An  increase  of  $20  per  capita  on  a 
population  of  62,000,000,  is  a  bid  of  about  $100  per  vote. 

The  laboring  classes  and  those  borrowing  money  constitute  about  nine- 
tenths  of  the  voters,  and  with  this  as  a  leading  issue  they  would  vote  in  over- 
whelming majorities  for  such  a  measure  in  utter  disregard  of  present 
party  lines.  It  will  certainly  be  made  an  issue,  unless  one  of  the 
dominant  parties  shall  pass  such  a  law   at   the  next  session  of   Congress. 


If  the  Democrats  propose  such  legislation  and  the  Republicans  resist 
it,  the  next  campaign  and  Congress  will  be  overwhelmingly  Democratic;.- 
should  the  Republicans  propose  the  law  and  the  other  party  oppose  it,  the 
results  will  be  in  favor  of  the  Republican  party. 

But  if  the  present  parties  show  the  people  '7io?r  not  to  do  it,'''  by  wasting- 
the  time  in  discussing  insufficient,  sham  and  subterfuge  plans,  to  deceive 
the  people,  they  will  certainly  pay  the  penalty  of  utter  political  defeat. 

The  homes  and  property  of  the  masses,  today,  are  in  jeapardy  by 
reason  of  an  insufificient  voluiiie  of  money.  Nine  million  homes  mortgaged 
at  a  high  rate  of  interest,  annii;il]y  eating  up  the  home,  means  nine 
million  solid  votes  for  more  money 

In  addition  to  this  the  industries  of  the  nation  are  seriously  crippled; 
the  further  developments  of  our  productive  areas  are  brought  largely  to  a, 
stand  still ;  the  laboring  classes  are  out  of  employment  by  the  hundreds 
of  thousands  because  employers  can  not  get  the  money  with  which  to  pay 
for  daily  labor. 

THE  STRINGENCY  OF  MONEY 

that  prevails  over  the  United  States,  and  recently  bordered  on  a  panic,, 
extends  to  England,  Germany,  France,  Russia,  and  in  fact  to  all  the  Europ- 
ean nations,  and  to  South  America.  For  want  of  money  long  established 
mercantile,  manufacturing,  commercial  and  financial  institutions,  noted 
for  decades  of  careful,  safe  business  management,  went  down  like  graia 
before  the  reaper.  They  went  down  for  want  of  money.  There  was  not 
enough  money  to  go  around  by  hundreds  of  millions  of  dollars.  When 
the  people  had  it  the  banks  were  hard  up,  and  when  the  banks  had  it  the- 
people  were  short. 

THE  CRASH  CAME  FOR  WANT  OF  MORE  MONEY. 

The  faihireB  of  1890  were $  190,000,000 

Shrinkage  of  New  York  stocks  and  bonds 600,000,000 

Shrinkage  of  values  in  United  States 10,000,000,000 

The  banks  called  in  over 100,^100,000 

The  United  States  Treasury  paid  out  over 200.000,000 

The  banks  issued  panic  certificates 30,000,000 

Tlie  U.  S.  Treasury  deposited  with  banks  to  help  tide  over 30,047.118 

Total $11,150,047,118 

Millions  were  shipped  from  England  and  California  to  fill  up  the  want, 
of  more  money.  After  all  this  effort  to  overcome  the  stringency  a  national 
bank  examiner  told  me  last  December  that  they  did  not  dare  to  examine- 
the  banks,  as  they  could  not  show  the  required  reserve.  They  were  sol- 
vent in  assets,  but  could  not  command  ready  money.  A  few  hundred 
more  millions  of  legal  tender  paper  money  in  circulation  would  have 
avoided  the  crash. 


THE  FINANCIAL  SITUATION 

of  the  8,050  banking  institutions  in  the  United  States,  State,  National, 
private  and  savings,  was  last  December,  as  shown  by  the  ofificial  reports, 
as  follows: 

Due  depositors  $4,G0o,844,1.57 

Cash  in  these  banks  to  meet  above  deposits: 

Gold  coin $    1)<),811,011 

Silver 28,811,478 

Paper  money 3-19,694,405 

$478,316,694 
That  is,  the  banks  had  ten  cents  on  the  dollar  to  pay  depositors.  In 
gold  they  had  only  about  two  per  cent;  in  gold  and  silver  less  than  three 
per  cent.  At  the  same  time  the  banks  had  loaned  out  §3,893,957,790  among 
62,000,000  people  scattered  over  an  area  of  3,400,000  square  miles  of  terri- 
tory. There  were  at  the  same  date  ^957,746,248  in  the  hands  of  the 
people  with  which  to  pay  the  banks.  In  fact,  after  deducting  state,  city, 
•couniy  and  other  public  funds,  there  was  not  10  cents  on  the  dollar  in 
the  hands  of  the  borrowers  to  make  payment  with.  Yet  the  wealth  of 
the  people  was  over  $71,000,000,000.  The  people  were  solvent  in  property 
twenty-fold,  but  could  not  command  available  cash.  It  was  not  in  the 
country,  as  shown  by  the  above  figures. 

The  volume  of  money  in  the  country  could  not  sustain  the  volume  of 
business,  and  over  $11,000,000,000,  one-seventh  of  the  entire  nation's 
wealth,  was  killed  ofP  in  the  short  space  of  a  few  months  for  want  of  a  few 
hundred  millions  more  of  money. 

THE  STRINGENCY  IS  MOKE  APPARENT 

from  other  statistics.  The  volume  of  business  in  the  United  States  last 
year  was  over  $130,000,000,000.  After  deducting  from  the  total  volume  of 
money  in  the  United  States,  reserves  of  banks,  and  United  States  Treas- 
nry,  and  State,  county,  city  tax  money,  and  other  public  funds,  there 
would  not  be  left  in  circulation  to  exceed  $700,000,000,  or  about  one-half 
of  a  cent  on  the  dollar  of  the  volume  of  business  with  which  to  do  the 
work. 

If  gold  and  silver  alone  were  used  it  would  only  be  about  one-eighth  of 
a  cent.  If  all  the  silver  mined  in  the  United  States  were  added  it  would 
give  less  than  one-quarter  of  a  cent  on  the  dollar  of  the  volume  of  busin 

The  volume  of  actual  money  fell  so  far  short  of  being  able  to  do  the 
work  that  the  commercial  world  was  forced  to  use  92  to  9  per  cent  in 
checks,  drafts,  certificates,  and  such  evidence  of  money  (as  shown  by  the 
Comptroller's  report  for  December,  1890.)  This  represented  some  $123,- 
000,000,000  of  such  paper  used  for  business.  This  was  the  worst  form  of 
inflation.  Back  of  it  was  only  the  shifting  and  personal  responsibility  of 
individuals,  firms  and  corporations,  and  a  fraction  of  a  cent  on  the  dollar. 
People  lost  confidence  in  this  vast  volume  of  checks,  drafts  and  paper  evi- 
dence of  money.     The  money  was  not  in   existence  in  volume  enough  to 


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sustain  it.  Tlie  same  relation  exists  between  the  volume  of  money  in  the^ 
country  and  the  credit  used,  as  between  a  bank  reserve  and  its  deposits. 
The  volume  of  the  money  must  increase  as  the  credit  increases.  The  people 
are  j)aying  in  interest  and  profit  to  foreigners  over  $50,000,000  per  year^ 
for  the  use  of  their  money,  to  increase  our  volume,  to  do  our  business.  If 
the  people  through  the  government  issue  their  own  circulating  medium, 
they  will  pay  this  $50,000,000  annual  interest  to  themselves.  AVhy  should 
we  be  in  financial  bondage  to  foreigners  and  work  for  them  when  we  can 
make  our  own  money,  and  use  it  for  the  same  purpose,  and  save  this  an- 
nual $50,000,000?  We  are  now  paying  this  tribute  to  foreign  capitalists, 
because  we  have  not  enough  of  our  own.  Why  should  we  pay  this  interest 
to  others,  when  as  a  nation  we  have  the  resources  to  issue  our  own  volume 
of  money, 

A  GLUT  OF  $20,000,000! 

Another  evidence  of  the  insufficiency  of  the  monev  supply  is  the  condi- 
tion of  the  New  York  banks  in  March,  1891.  They  claim  to  have  a  glut 
of  money — a  surplus  of  $20,000,000  over  the  required  legal  reserve.  This 
is  the  result  of  calling  in  loans  from  the  channels  of  trade.  It  is  not 
money  returned  voluntarily  by  the  users  of  money.  It  can  all  be  absorbed 
in  a  day  by  the  places  from  which  it  was  called  in. 

But  the  most  startling  fact  disclosed  by  this  boasted  glut,  is  that  there 
is  not  enough  money  in  all  these  banks  over  the  legal  reserve,  to  even 
start  one  railroad  company.  The  best  railroad  enterprise  with  gilt  edge 
security  would  absorb  this  boasted  $20,000,000,  in  building  its  first  few 
miles  of  track. 

On  December  19th,  1890,  the  secretary  called  a  report  from  all  national 
banks  in  the  United  States.  They  average  less  than  2  per  cent  above  a 
25  per  cent  reserve.  Which  leaves  in  the  whole  national  banking  system 
of  the  United  States  only  about  $50,000,000  for  use.  Of  this  sum  !t30,000- 
000,  is  United  States  Treasury  money  deposited  in  the  banks  to  help  them 
make  the  December  showing  and  to  relieve  the  financial  danger.  On  April 
11th  this  surplus  has  fallen  to  $5,600,000.  No  wonder  the  business  of  the 
nation  is  paralyzed.  It  becomes  apparent  from  these  results  obtained 
from  official  reports,  that  the  banks  in  the  United  States  dare  not  loan  any 
money  on  time  loans  to  develop  or  maintain  the  industries  and  business, 
of  the  people. 

THE    FINANCIAL    VACUUM 

thus  briefly  pictured  to  you,  called  a  uey  stringency,  means  only  one 
thing.  An  insufficient  supply  of  money.  Of  this  Secretary  Windom  said 
in  his  last  address  in  New  York:  ''  had  it  not  been  for  the  peculiar  condi- 
tions which  enabled  the  United  States  Treasury  to  disburse  over  1175,000,- 
000  in  two  and  one-half  months,  last  fall,  the  stringency  would  have  re- 
sulted in  wide-spread  financial  ruin."  The  market  was  not  just  then  cry- 
ing for  more  of  that  95  per  cent  of  checks,  drafts,  panic  certificates,  or 
other  evidences  of  money.  It  wanted  the  money  and  had  to  have  either- 
the  money  or  "the  wide  spread  financial  ruin." 


THE    DEMAND. 

You  have  seen  the  negative  side  of  the  question,  the  want  of  money. 
Now  take  the  other  half  of  the  picture  and  look  at  the  affirmative  demand 
for  money.  Over  $10,000,000  were  used  in  18i)0  to  start  new  banks  in  the 
South  alone  as  much  more  in  the  West.  The  cotton  crop  was  valued  at 
$400,000,000.  Over  17,000  new  enterprises  started  in  the  South  last  year, 
embracing  every  variety  of  industry.  Over  32.800  miles  of  railroad  were 
built  the  last  four  years,  at  a  cost  of  $3,000,000,000,  New  York  city  used 
$300,000,000  in  new  buildings,  while  the  West  used  money  by  the  millions 
for  its  new  enterprises,  many  of  which  are  shut  down  for  want  of  money. 

This  wonderful  growth  and  energy  is  not  to  be  condemned.  It  is  the 
preparing  of  this  continent  for  homes,  and  for  the  support  of  the  genera- 
tions. All  of  these  aids  for  civilization  are  to  uplift  humanity  to  its  high 
and  peerless  destiny. 

It  furnishes  labor,  food  and  clothing  for  the  poor;  it  furnishes  use  for 
raw  material,  and  results  in  industry,  home  and  happiness  for  millions. 

GROWTH    OF    CIVILIZATION. 

The  world  has  been  progessing  in  civilization,  in  commerce,  industries; 
and  in  business  with  wonderful  rapidity  during  the  past  century  and 
especially  during  the  past  fifty  years. 

Kussia  has  broken  its  lethargy,  and  is  restless  with  energy.  Asia  has 
thrown  off  its  isolation  and  its  population  half  awakened  from  a  dream  of 
a  thousand  years  is  stretching  forth  its  hands.  India  is  contending  for  its 
ancient  glory.  Afiica  is  showing  to  the  world  its  rich  fertile  soil,  its 
rivers,  its  gold  and  diamonds,  and  treasures  for  commerce  and  agriculture] 
All  South  America  is  organizing  for  civilized  growth  and  work  with  its 
wealth  of  soil  and  mines  to  tempt  the  industry  of  man. 

The  islands  of  the  sea  from  the  almost  continent  of  Australia  to  the 
little  islands  are  becoming  active  struggling  centers  for  their  part  of  com- 
merce. The  business  area  of  the  United  States  in  less  than  a  century  has 
spread  from  the  small  territory  east  of  the  Alleghanies,  to  an  empire  ex- 
tending across  a  continent  from  some  3,000,000  to  62,000,000  people  now 
scattered  over  3,400,000  square  miles  and  overflowing  with  business,  en- 
ergy and  push,  eager  to  develop  the  resources  of  their  continent,  and  pre- 
pare it  for  the  habitation  of  the  coming  hundreds  of  millions.  The  whole 
earth  is  rapidly  being  prepared  for  the  comfortable  occupation  of  man. 

The  world  is  constantly  outgrowing  its  api^liances  for  civilization.  The 
circulating  medium  of  exchange  is  no  exception  to  the  rule  All  hitherto 
adopted  forms  of  money  ha^'e  been  outgrown  in  kind  and  in  volume. 

The  skins  of  wild  animals  at  an  early  age  were  the  money  of  exchange. 
This  Avas  outgrown  and  they  stored  the  skins,  cutting  off  the  ears  and 
passing  them  as  a  more  convenient  form  of  money,  the  owner  being  en- 
titled at  any  time  to  call  for  the  corresponding  pelts.  This  was  the  first 
bank  of  deposit.  At  a  later  age  stamped  pieces  of  leather  were  the  evi- 
dences of  value,  gold  and  silver  not  being  enough  in  volume.  The  Chinese 
have  used  paper  money  for  thousands  of  years  past. 


Drafts,  certificates  of  deposit,  promissory  notes  and  orders  for  money 
were  used  by  the  ancients  to  increase  the  volume  of  the  medium  of  ex- 
change. 

INTERNATIONAL    DEMAND. 

The  following  demands  for  large  loans  are  now  on  the  market  of  the 
world: 

Aurtro- Hungary ii^lOO.OOO.OOO 

France 182,000,000 

Mexico 40,000,000 

Argentine  Republic 500,000,000 

Other  South  American  States 725,000,000 

African  Mines,  Trust  Companies,  etc ■, 350,000,600 

$1,897,000,000 

Other  nations  want  fully  as  much  more,  to  say  nothing  of  local  demands 
in  each  nation. 

In  the  Baring  Bros,  trouble.  Lord  Salisbury  refused  to  allow  the  Bank 
of  England  to  furnish  aid.  Thereupon  the  President  of  the  Bank  said  to 
him:  "My  Lord,  I  am  instructed  to  tell  you,  in  case  you  refuse,  that  un- 
less the  Government  comes  to  the  rescue,  there  is  hardly  a  bank  in  the 
United  Kingdom  that  can  be  relied  upon  to  meet  the  demand  of  its  cred- 
itors TWENTY-FOUR   HOURS   AFTER    THE   DISASTER   WE   APPREHEND.        The    relief 

was  quickly  ordered. 

It  is  evident  from  the  facts  already  cited  that  there  is  an  insufficient 
supply  in  the  United  States  and  that  other  nations  have  all  they  can  do 
to  take  care  of  themselves.  This  condition  of  things  drives  our  bank  to  a 
system  of 

CALL    LOANS, 

or  30  to  90  day  paper.  They  dare  not,  of  course,  make  time  loans.  As  a 
result  the  growth  and  development  of  our  Southern  and  Western  country 
is  largely  at  a  standstill. 

Who  of  you  can  take  a  call  loan  or  a  30  or  90  day  loan  and  plant  an 
orchard,  develop  a  farm,  build  a  railroad,  open  a  mine,  or  establish  any 
industry. 

ou  well  know  that  all  these  must  have  time  loans  and  such  loans  can 
never  be  had  in  a  stringent  money  market.  An  abundant  volume  of 
money  would  result  in  time  loans  all  over  the  West  and  South.  It  would 
give  employment  to  the  idle  hundreds  of  ousands  who  today  in  the 
East,  West  and  South,  are  anxious  to  work.  This  unused  labor  is  a  dead 
loss  to  the  nation.  An  idle  day  is  gone  orever,  it  can  never  be  used  to 
plant  a  single  hill  of  corn.  The  laborer  is  poorer  by  every  idle  day.  In 
the  United  States  wo  are  daily  destroying  the  labor  of  over  three  hundred 
thousand  men,  worth  say  $1.50  per  day,  equal  $450,000  daily  or  aggregat- 
ing $135,000,000  per  year  of  300  days.  This  labor  spent  in  the  South  and 
West  (1  weloping  their  marvelous  resources  would  feed  and  cloth  a 
hungry  million. 

Tais  idle  labor  would  in  one  year  levee  the  Mississippi  from  St.  Paul  to 


9 

the  Gulf.  It  would  construct  the  Henepin  Canal  the  next  year,  and 
"would  in  a  few  years  complete  the  Galveston  harbor,  construct  a  Ship 
Canal  across  the  isthmus  and  another  from  the  Missouri  near  Chicago  to 
the  lakes  as  well  as  complete  other  great  national  works.  Yet  this  is  all 
lost  annually  for  want  of  money  to  pay  daily  labor. 

It  would  seem  that  our  government  was  run  on  the  theory  that  it  must 
protect  the  money  even  if  it  should  starve  citizens. 

Letters  to  this  convention  from  prominent  Eastern  financiers  protest 
against  any  charge  in  this  blundering  financial  chaos.  And  urge  that 
we  do  should  do  nothing.  The  East  has  dictated  the  finances  of  this 
nation  to  the  present.  The  job  is  not  a  credit  to  their  ability  and  it  is 
time  we  tried  a  change.  The  London  Times  says,  "The  whole  monetary 
system  of  the  United  States  is  in  a  muddle.  This  condition  is  due  to 
piecemeal  legislation."  The  case  grows  worse  in  the  hands  of  these 
financial  doctors  and  they  now  say  let  the  patient  alone  and  he  will  either 
die  or  get  well  in  time,  and  they  don't  know  which. 

Under  such  circumstances  it  may  be  well  to  try  another  mode  of  treat- 
ment. 

THE  VOLUME  liEQUIRED 

should  be  ample  in  view  of  the  facts .  It  cannot  be  accurately  deter- 
mined, but  we  should  not  therefore  leave  it  without  any  solution.  Ap- 
proximation is  all  that  can  be  attained. 

Generally  the  volume  should  e  such  that  the  United  States  treasury 
could  hold  a  safe  reserve  of  say  25  per  cent  of  the  volume  issued.  So,  also, 
tliat  the  banks  could  hold  a  25  per  cent  reserve  of  deposits,  and  also  the 
tax  money  could  go  into  its  legal  vaults.  An  estimate  might  be  added  for 
hoarding  and  loss  by  accident.  In  addition  to  the  above  reserves  there 
should  be  a  full  volume  in  circulation  among  the  people  for  the  business 
of  the  nation.  A  volume  such  that  time  loans  could  be  abundantly 
supplied. 

More  specific  figures  would  be  suggested  by  the  following  statistics : 

State  and  National  banks  have  deposits $2,516,179,807 

Take  this  as  the  volume  of  issue  and  we  have,  say : 

Twenty- five  per  cent  for  United  States  treasury 629,044,951 

"  "    Bank  reserves 629,044,951 

Eor  tax  money 114,072,288 

Total  reserve 11,372,162,190 

Taking  this  sum  from  the  proposed  volume  there  would  be  left 
$1,144,017,617,  for  active  use. 

If  the  above  reserves  were  deducted  from  the  present  volume  of  |2,082,- 
568,942  it  would  leave  only  $710,406,734  for  daily  use.  The  increase  for 
active  circulation  under  the  proposed  volume  is  $433,61i ',883.  In  other 
words,  the  country  would  hold  the  last  amount  named  to  protect  business, 
instead  of  the  present  paltry  $50,000,000.  From  this  volume  the  business 
requiring  time  loans  could  be  safely  supplied. 


10 

This  is  not  an  experimental  volume.  It  would  represent  about  $40  per 
capita  for  our  population,  while  France  uses  from  §42  to  §^44  per  capita. 
We  could  safely  use  a  larger  volume  than  France  does. 

This  would  give  a  volume  of  about  $40  per  capita,  of  which  about  $20 
would  be  gold  and  silver,  and  $20  in  paper  money. 

NOT  ENOUGH  GOLD  AND  SILVER. 

The  total  gold  and  silver  coin  and  bullion  in  the  comercial  world  is : 

Gold   $3,984,256,589  or  $3.22  per  capita. 

Silver 4,512,754,655  or    3.65  per  capita. 

Total $8,497,011,244  or  $6.87  per  capita. 

The  annual  product  of  the  world  averaged  for  eight  years  is: 

Gold $108,276,258  or  .08  per  capita. 

Silver 121,389,242  or  .09  per  ca]nta. 

Total $229,665,500  or  .17  per  capita. 

The  business  of  the  world  cannot  be  run  on  such  a  small  circulating- 
medium. 

The  nation  finds  the  metallic  supply  wholly  insufKcient  and  supple- 
ments its  use  by  $2,178,642,376  of  unsecured  paper  money  in  order  to  con- 
duct the  world's  business. 

The  gold  in  the  United  States  represents  only  $694,869,680,  or  $11  per 
capita. 

The  annual  increase  is  about  25  cents  per  capita. 

The  total  amount  of  silver  is  about  $485,870,497,  or  $8  per  capita.  The 
annual  increase  is  about  74  cents  per  individual.  Gold  and  silver  would 
therefore  give  only  $19  per  capita  and  about  85  cents  per  capita  annual 
increase.  The  total  volume  of  gold  and  silver  in  the  world  is  only  about 
$5.75  per  capita  of  the  world's  population.  There  is  no  alternative  but  to- 
issue  paper  money  to  supplement  gold  and  silver. 


WHAT  IS  THE  REMEDY 


Several  have  been  proposed,  but  they  are  inadequate,  local  and  partisan. 
Free  coinage  of  silver  cannot  accomplish  the  desired  results.  The  annual 
increase  of  our  population  is  such  that  the  coinage  of  our  entire  nationaj 
silver  product  would  only  give  the  per  capita  for  our  increase.  It  will  in 
no  manner  relieve  the  standing  need. 

The  great  objection  to  free  coinage  is  that  our  annual  product  is  worth 
in  the  market  $46,000,000.  When  coined  it  represents  $64,000,000,  or  $18,- 
000,000  profit  added  by  the  Government  agreeing  to  pay  that  difference  on 
demand.  This  makes  a  present  of  $18,000,000  annually  to  the  producers 
of  silver. 

The  people  are  now  buying  all  of  this  silver  at  about  97  cents  per  ounce^ 
Why  should  they  pass  an  Act  of  Congress  raising  the  price  against  them, 
selves  to  $1.29. 


11 

Some  in  this  convention  urge  that  free  coinage  will  cause  this  difference 
to  disappear.  So  it  will  by  permanently  adding  the  difference  to  the 
present  cost.  Free  coinage  will  cause  it  to  disappear,  by  transferring  it 
from  the  benefit  of  the  buyer  (the  people)  to  the  benefit  of  the  seller  (the 
silver  owner).  That  is  the  free  coinage  act  of  congress  is  worth  about  32 
cents  on  each  ounce,  and  silver  is  worth  the  other  97  cents.  The  silver 
belongs  to  the  silver  men,  and  the  Act  of  Congress  belongs  to  the  people, 
and  the  silver  men  ask  the  people  to  donate  to  them  the  Act  of  Congress, 
worth  32  cents  per  ounce  of  silver,  and  then  let  the  people  pay  them  for 
the  whole  thing. 

Why  do  the  people  of  the  United  States  want  to  advance  the  price  of 
silver  on  themselves  ? 

Let  the  people  buy  and  store  for  their  use  all  the  silver  they  want,  or 
that  is  profitable  to  them  to  buy. 

FREE    COINAGE    IS    NOT    IN    ISSUE 

before  the  people.  The  silver  owners  do  not  ask  free  coinage  and  possibly 
do  not  want  it.  Free  coinage  means  that  the  silver  be  coined  into  dollars, 
and  delivered  to  the  owner.  The  silver  owners  set  forth  their  demand  in 
their  silver-bill  of  last  Congress.  This  bill  provides  that  the  owners  of 
silver  may  deposit  their  bullion  in  any  mint,  and  may  take  either  the 
coined  silver  or  paper  money  therefor,  the  paper  money  exchangeable  on 
demand  for  gold  and  a  full  legal  tender  for  all  debts. 

The  silver  bullion  is  not  made  a  legal  tender,  only  the  paper  money  is- 
sued therfor.  The  bill  does  not  even  require  the  silver  bullion  to  be  held 
to  redeem  the  paper  money  issued.  It  is  simply  stored  in  the  United 
States  vault  as  an  asset.  The  people  are  responsible  to  pay  in  gold  the 
paper  money  issued  and  would  have  to  sell  silver  in  the  market  of  the 
world  for  whatever  it  would  bring.  If  we  are  going  to  issue  paper  money, 
which  we  should  do,  let  us  issue  it  direct  from  the  people,  based  on  the 
wealth  of  the  nation. 

This  silver  deal  will  cost  the  people  $18,000,000  extra  annually,  which, 
with  5  per  cent  interest  would  amount  in  fifty  years  to  some  110,993,695,- 
800.  That  is  the  pcopl  3  would  be  paying  that  sum  to  the  money  power 
for  the  privilege  of  issuing  paper  money  via  the  silver  route. 

Tou  people  who  are  using  money  and  paying  for  it  read  again  the  above 
elucidation,  and  then  take  a  firm  stand  for  a  sufficient  volume  of  safe 
paper  money.  You  should  refuse  to  support  any  bill  extending  the  use 
of  silver  unless  the  same  bill  secures  you  a  full  volume  of  pajjer  money. 
Unless  you  do  you  will  never  get  any  relief  beyond  the  limited  amount  of 
silver.  You  may  then  have  to  fight  a  combined  gold  and  silver  monopoly. 
Nothing  but  a  constitutional  amendment  will  save  you. 

That  our  government  should  buy  our  silver  product  and  hold  it  as  a 
reserve  for  such  time  as  may  be  advisaljle,  would  seem  to  be  good  as  far  as 
it  goes,  but  it  can  not  meet  the  demand  for  a  full  circulating  medium. 
Another  remedy  suggested  is  the 


12 

50  YEAK  2  PEE  CENT.  BONDS. 

This  is  simply  a  scheme  to  aid  banks  at  the  expense  of  the  people,  and 
seems  to  have  had  its  origin  and  backing  in  the  secret  councils  of  those 
who  wish  to  monopolize  the  money  system  of  the  United  States. 

Look  at  it!  Its  advocates  say,  issue  these  bonds  and  sell  them,  and  re- 
deem the  4  per  cent  bonds,  and  let  the  national  banks  buy  the  2  per  cent 
bonds  as  a  basis  of  circulation.  How  will  it  work?  "Will  the  owner  of  4 
per  cent  bonds  exchange  even  for  2  per  cent  bonds  ?  Certainly  not.  Then 
if  you  sell  the  2  per  cent  bonds  at  par  and  pay  a  premium  on  the  4  per 
cent  bonds  you  will  have  to  pay  all  the  4  per  cent  ones  will  earn  up  to 
maturity.  We  will  then  be  paying  G  per  cent  instead  of  4  per  cent  as  now, 
and  that  does  not  increase  our  circulating  medium  a  dollar.  The  people 
are  simply  saddled  with  more  interest. 

The  sale  of  2  per  cent  bonds  to  banks  as  a  basis  of  circulation  is  a  rob- 
bery of  the  people.  '  To  illustrate:  The  United  States  issues  say  §100,000, 
in  2  per  cent  bonds,  you  wishing  to  open  a  bank  take  $100,000  cash,  now  in 
circulation,  and  pass  it  over  to  the  United  States  for  the  $100,000  in 
bonds.  Next,  you  hand  back  your  bonds,  as  a  deposit,  to  the  United 
States,  and  get  back  your  $100,000  cash  for  a  bank  capital,  and  for  fifty 
years  the  tax  payers  through  the  government  pay  you  2  per  cent  per  year, 
$100,000  interest  on  the  bonds  for  doing  a  banking  business  on  your  orig- 
inal $100,000.  If  you  use  the  semi-annual  interest  to  buy  more  bonds,  so 
as  to  make  it  compound,  you  will  at  the  maturity  of  the  bonds  have  your 
original  $100,000  plus  $100,000  interest,  plus  about  870.895  bonds  bought 
with  interest  on  interest,  making  a  total  profit  of  $170,895  for  doing  busi- 
ness on  your  own  money.  But  during  this  fifty  years  your  original  $100,- 
000  will  be  loaned  out  to  the  same  tax  payers  who  are  i^aying  2  per  cent 
interest  on  the  bonds  to  you.  This  loaned  out  capital  will  bring  in  ruling 
rates  which  by  the  scarcity  of  money  will  be  high.  This  with  the  profits 
arising  from  the  periodical  wrecking  of  the  people  ought  to  satisfy  the 
owners  of  money.  It  will,  however,  engender  the  thought  among  the 
masses  that  the  banks  should  be  killed  off.  Our  present  banking  capital 
is  some  $700,000,000.  At  the  end  of  fifty  years  operating  under  this  bond 
scheme  the  banks  would  own  their  capital  stock  $700,000,000  plus  $1,196,- 
265,000  interest  on  bonds,  plus  over  $3,000,000,000  interest  on  the  capital 
stock  for  fifty  years.  That  is  the  banks  will  own  all  the  money  in  the 
United  States  and  have  the  people  in  debt  to  them  nearly  $3,000,000,000. 
You  perceive  at  once  that  this  scheme  will  not  increase  our  circulating 
medium.  This,  hower,  is  not  as  costly  to  the  people  as  the  proposed 
silver  bill,  which  in  fifty  years  costs  over  $10,000,000,000  extra. 

Another  proposed  scheme  to  place  the  money  power  in  the  hands  of  a 
few  as  a  monopoly  is  the 

CLEA.RING-HOUSE    PLAN. 

It  is  embodied  in  a  proposed  national  clearing-house  system  to  J6  in- 
corporated under  an  Act  of  Congress,  by  which  a  confederation  of  banks 
can  put  up  approved  collateral  with  the  clearing-house  and  receive  clear- 


13 

ing-house  notes,  to  be  legal  tender,  the  combined  clearing-house  being 
responsible  for  redemption  in  case  the  individual  bank  fails  to  redeem. 
This  system  is  put  forth  by  a  prominent  eastern  banker  who  asserts  that 
we  need  no  more  money.  Yet  this  whole  scheme  is  to  increase  the  circu- 
lating medium,  but  giving  the  banks  a  monopoly  of  issuing  and  controlling 
it.  Its  weak  point  is  in  placing  baqk  of  our  currency  no  greater  responsi- 
bility than  the  banks  and  their  property.  It  also  gives  the  banks  the  right 
to  obtain  money  without  interest  and  loan  it  on  interest. 

Better  let  the  government  issue  the  money  with  the  resources  and  wealth 
of  the  whole  people  of  the  United  States,  valued  at  $71,000,000,000  back  of 
it  for  redemption.  If  the  property  of  a  combination  of  banks  back  of  a 
money  issue  is  good,  then  the  wealth  of  the  nation  back  of  the  issue  is 
better. 

As  a  nation  we  want  no  money  for  the  people  which  is  only  backed  by 
the  responsibity  of  a  small  part  of  the  people  having  absolute  control  of  it 
for  selfish  ends. 

FAEMEhS'     ALLIANCE    SCHEME. 

This  scheme  has  some  sound  points  in  it.  Land  can  be  safely  used  as  a 
security  in  the  national  bank  system  as  well  as  bonds.  Allowing  the  title 
to  land  at  a  valuation  of,  say,  its  averaged  assessed  value  for  the  preceding 
five  years,  and  not  to  exceed  one-half  of  its  cash  value,  to  be  pledged  to 
the  government  under  the  form  of  a  national  bank  incorporation,  would 
give  relief  to  the  farming  communities. 

It  would  substitute  a  national  bank  for  a  sub-treasury ;  a  set  of  bank 
officers  elected  by  the  farmers  for  their  banks  to  manage  the  loans  for  a 
set  of  sub-treasury  agents ;  a  responsibility  to  the  government  for  large 
aggregate  sums  under  the  bank  laws,  instead  of  the  inspection  of  thous- 
ands of  small  changing  loans.  The  supervisions  of  the  Bank  Examiners 
under  present  laws  as  to  the  solvency  of  the  bank  would  be  all  that  was  re- 
quired, while  the  bank  officers  would  supervise  all  detail  business  and  loans 
to  individuals. 

The  great  objection  to  the  sub-treasury  scheme  is  that  it  is  local  and 
partisan,  and  only  helps  one  class  instead  of  all  classes. 

The  circulating  medium  should  be  issued  by  authority  of  the  whole 
popidation  and  should  be  backed  by  the  entire  wealth  of  the  nation,  and 
should  be  controlled  for  the  common  benefit  of  all.  The  2  per  cent  bond 
system — the  fi'ee  coinage  system — the  national  bank  clearing  house  issue 
and  sub-treasury  plans  fail  because  they  are  in  the  interest  of  localities  and 
minorities.  If  temporarily  successful  they  would  soon  be  destroyed  by 
the  majority  as  unjust.  Justice  and  equity  to  all  must  be  at  the  founda- 
tion of  any  system  adopted  by  our  nation. 

At  present  the  United  States  Treasury  throws  its  reserve  power  to  sup- 
port Eastern  banks.  It  is  very  probable  that  the  West  would  be  denied 
any  such  relief  in  an  emergency.  Over  $30,000,000  of  United  States 
money  is  in  banks  without  interest  and  largely  without  security.  The  re- 
cent panic  demonstrated  both  in  the  United  States  and  in  England  that  at 


14 

"times  the  power  of  the  nation  must  come  to  the  tinancial  relief  of  the  peo- 
ple. This  then  should  be  put  in  a  legislative  sj-stem  on  safe  business 
pi'inciples  within  the  reach  of  all  parts  of  the  country  for  the  common 
good. 

SUGGESTED    LEGISLATION. 

In  preparing  the  scheme  which  is  submitted  for  your  consideration  I 
have  retained  the  safeguards  existing  in  the  money  systems  of  the  United 
States,  England.  France  and  Germany,  and  have  added  such  measures  as 
will  give  a  uniform,  practicable,  elastic  system,  free  from  inflation,  con- 
traction, repudiation  or  a  change  of  the  abstract  standand  of  value.  A 
system  based  on  the  authority  of  the  people,  backed  by  the  wealth  of  the 
people,  and  administered  for  the  benefit  of  the  whole  population.  Using 
all  of  our  gold  and  silver,  and  supplementing  their  use  by  a  legal  tender 
of  $20  to  $25  per  capita,  which  represents  2  cents  on  the  dollar  of  our 
national  wealth. 

A    CONSTITUTIONAL    AMENDMENT 

is  placed  at  the  foundation  of  the  proposed  system. 

One  of  the  greatest  dangers  in  our  present  law  is  the  doubt  as  to  the 
constitutional  power  of  Congress  to  make  paper  money  a  legal  tender. 
The  United  States  Supreme  Court  first  decided  by  five  Justices  to  three 
that  Congress  had  no  power  to  make  paper  money  a  legal  tender,  Chief 
Justice  Chase  rendering  the  opinion. 

One  of  the  five  resigned.  Congress  increased  the  number  of  Justices 
from  eight  to  nine;  the  two  vacancies  were  filled  by  men  who  joining  the 
opinion  of  the  minority  held  that  as  a  war  measure  Congress  had  power 
to  make  paper  money  a  legal  tender. 

This  decision  stood  five  Justices  to  four.  Three  more  of  the  four  have 
died,  and  their  places  have  been  filled  by  those  who  believe  in  this  power, 
and  in  its  latest  decision  our  United  States  Supreme  Court  holds  by  eight 
to  one  that  Congress  can  make  anything,  in  any  quantity,  a  legal  tender. 
In  other  words,  the  doors  are  thrown  wide  open  to  inflation  of  the  worst 
form.  Even  now,  are  proposed  measures  that  have  no  limit  to  currency 
issue.  A  future  administration  and  Supreme  Court  could  overrule  the 
above  decision  and  hold  that  the  whole  currency  issued  was  unconstitu- 
tional and  void,  and  was  not  even  a  claim  against  the  nation.  Such  a  de- 
cision would  leave  a  gold  and  silver  money  in  absolute  control.  And 
where  would  the  people  find  relief. 

Three  dangers  are  at  the  very  root  of  our  financial  laws,  ruinous  infla- 
ticm,  constitutional  repudiation  and  a  threatened  change  of  the  gold  dollar 
as  a  measure  of  values. 

A  safe  monetary  system  is  one  of  the  essential  elements  of  the  prosperity 
of  this  nation.  It  must  stand  before  the  people  of  this  and  other  nations, 
founded  upon,  and  guarded  by  constitutional  power,  protecting  it  from 
the  dangers  of  inflation,  contraction,  repudiation,  or  change  of  the 
standard  of  values,  and  pledging  the  faith,  and  resources  of  the  nation  as 


]5 

the  power  and  will  of  the  nation  to  exchange  gold,  silver  and  currency  at 
par  on  demand. 

An  amendment  worded  about  as  follows  would  cover  the  ground: 

PR  jposed  constitutional  amendnent. 

Article  XVI.  Sectiov  1.  A  national  currency  circulating  medium 
shall  be  issued  to  the  amount  of  twenty  dollars  per  capita,  as  shown  by  the 
census  of  1890  and  by  each  succeeding  census,  for  the  proper  redemption 
of  which  when  required,  the  resources,  the  property  and  the  faith  of  the 
nation  are  pledged;  for  which  redemption.  Congress,  by  a  two-thirds  vote 
of  each  House,  may  provide  for  the  collection  of  Government  revenues  and 
taxes,  in  gold  or  silver  coin. 

Sec  2.  Said  currency,  with  gold  and  silver  coin  of  the  United  States  of 
present  weight  and  fiaeness,  the  gold  dollar  being  the  standard  or  unit  of 
values,  and  such  notes  as  may  be  issued  in  lieu  of  gold  or  silver  coin  and 
bullion,  held  exclusively  for  the  redemption  thereof,  shall  constitute  the 
only  legal  money  of  these  United  States,  and  shall  be  received  at  par  in 
satisfaction  of  all  obligations  for  the  payment  of  money  within  the 
jurisdiction  of  the  United  States.  Said  gold  and  silver  coin  and  currency 
shall  be  exchangeable  at  par  value. 

Sec.  3.  Congress  shall  have  power  to  enforce  this  Article  by  appropri- 
ate legislation,  but  shall  have  no  power  to  increase  or  decrease  said  issue; 
provided  that  after  the  issue  of  1900,  Congress  may,  by  a  two-third  vote 
of  each  House,  reduce  the  rate  of  any  further  issue  per  capita  from  time 
to  time.  ' 

This  amendent,  underlying  our  national  system  of  finances  would  give 
us  the  best  foundation  and  safeguards  ever  yet  adopted  by  any  nation. 

The  volume  is  protected  against  inflation,  contraction  or  repudiation. 
It  represents  about  two  cents  on  the  dollar  of  our  national  wealth  of  some 
3,400,000  square  miles  of  land  and  national  wealth  of  $71,000,000,000. 
This  is  in  legal  efPect  a  first  mortgage  given  by  the  nation  to  secure  redemp- 
tion. With  such  security  the  national  currency  would  be  considered  gilt- 
edge  paper  in  any  market  in  the  world.  It  would  be  received  with  greater 
confidence  than  Bank  of  England  notes. 

The  gold  dollar  is  today  the  standard  by  which  all  values  in  the  United 
States  are  rated  or  measured,  and  as  an  abstract  standard  of  values,  this 
amendment  removes  fi'om  controversy  or  doubt  thatdi  turbing  element  by 
fixing  the  gold  dollar  as  the  standard  of  measure.  It  at  the  same  time 
does  full  justice  to  silver,  by  making  it  and  paper  money  a  legal  tender, 
with  gold  at  the  par  value.  In  this  way  the  whole  people  make  the 
difference,  if  any,  between  the  market  value  and  the  coined  value,  and 
when  exchanged  for  gold,  repay  the  difference.  The  double  standard  is 
not  really  required.  The  use  of  two  metals,  the  government  standing  re- 
sponsible for  any  difference  in  value  in  all  that  can  be  obtained.  The 
Government  buying  the  silver  and  coining  or  holding  it  makes  the  differ- 
ence between  the  market  value  and  the  money  value  ;  and  repays  that 
difference  when  it  gives  gold  for  the  silver.     This  is  the  same  thing  that 


16 

occurs  when  a  paper  dollar  is  issued.  The  United  Sates  makes  a  gold 
dollar  net  at  time  of  issue,  and  when  the  paper  dollar  is  taken  back  by  the 
United  States  it  returns  the  gold  dollar.  As  a  commercial  or  scientific- 
fact  nothing  other  than  the  above  has  ever  been  done,  and  as  that  is  a 
plain  law  of  nature  nothing  else  can  ever  be  done.  You  may  cover  that 
simple  idea  under  volumes  of  words,  sophistries  or  legislative  enactments 
and  that  simple  little  law  of  nature  will  always  appear  at  the  settlement 
and  adjust  the  difference  and  no  one  can  prevent  t. 

This  amendment  would  protect  the  currency  against  the  dangers  of  the 
John  law,  or  Argentine  Ee^^ablic  scheme,  and  from  the  dangers  that  beset 
the  Continental  money.  It  is  a  greater  safeguard  than  is  thrown  around 
the  Bank  of  England  notes. 

No  nation  can  place  back  of  its  issues  such  security  as  this  would  give 
to  American  money.  England  cannot  place  back  of  an  issue  the  resources 
of  Canada,  Australia,  India  or  her  African  possessions,  for  at  any  time 
they  might  leave  England  and  set  up  for  themselves,  leaving  only  the  little 
island  to  redeem  the  currency  issued.  France  and  Germany  are  to  small. 
r^r.ssia  is  too  insecure  in  her  form  of  government.  But  the  United  States, 
with  its  vast  area,  its  peaceful  and  stable  form  of  government,  and  its 
citizens,  each  an  owner  in  the  currency,  is  in  position  to  issue  a  currency 
that  would  be  received  at  once  by  any  nation  as  a  medium  of  exchange — a. 
representative  of  gold  at  par,  and 

AS    GOOD    AS    GOLD. 

Such  a  legal  tender  note  is,  in  money  effect,  the  clearing-house  certifi- 
cate of  the  nation,  backed  by  the  national  wealth,  good  in  any  clearing 
house  in  the  United  States,  instead  of  a  certificate  backed  by  any  number 
of  banks,  and  only  good  where  they  wish  to  accept  it  by  courtesy.  It  is  a 
check  signed  by  authority  of  the  people  of  the  United  States,  backed  by 
over  $71,000,000,000  of  the  people's  wealth,  good  at  any  counter  of  any. 
bank,  instead  of  an  individual's  check,  only  good  at  his  own  bank  and  ia 
his  own  locality.  It  is  the  promissory  note  of  the  nation,  secured  by  a 
constitutional  mortgage  on  over  2,500,000,000  acres  of  land  and  the  cities, 
railroads  and  civilization  thereon,  payable  to  bearer  and  good  from  any 
debtor  to  any  creditor,  instead  of  the  private  note  of  a  citizen,  secured  by 
a  mortgage  on  a  few  aci'es  of  land,  and  only  good  at  a  discount  to  those 
who  wish  to  buy  it.  It  is  a  representative  of  value  for  exchange  purposes, 
mutually  agreed  upon  by  62,000,000  of  people  for  their  joint  benefit, 
backed  by  their  constitutional  bond  to  secure  redemption  when  required, 
on  which  bond  the  people  pay  no  interest. 

Such  a  currency  circulating  medium  possesses  all  the  elements  of  safety 
offered  in  all  other  proposed  systems  combined,  and  many  others  that 
cannot  be  introduced  into  any  other  system,  and  is  as  good  as  gold. 

Confidence  would  never  be  lost  in  this  medium,  for  the  amendment 
•would  prevent  Congress  or  politicians  or  political  parties  from  disturbing 
the  foundations,  as  at  present. 


17 

GOLD    AND    SILVKR    BASIS. 

An  issuance  of  paper  money  based  on  gold  and  silver,  dollar  for  dollar; 
gives  no  increase  in  volume.  Every  dollar  of  paper  issued  locks  up  a 
dollar  of  coin  for  redemption. 

Again,  an  issue  of  say  two  billions  paper  money,  based  on  one  billion 
coin  reserve  represents  the  other  billion  of  the  paper  money  secured  only 
by  the  wealth  of  the  nation.  The  true  plan  is,  put  all  the  gold,  silver,  real- 
estate,  cities,  railroads,  improvements,  personal  property",  etc.,  of  the  value 
of  $71,0OO,0O0,U00  solid  l^ack  of  the  issue  of  say  $2,500,000,000,  holding  the 
coin  for  such  occassional  use  thereof  as  may  be  required.  The  whole 
wealth  of  the  nation  back  of  an  issue  is  better  than  any  part  of  the  wealth. 
The  coin  basis  of  any  issue  is  a  plan  in  the  interest  of  the  owners  of  the 
coin,  and  gives  no  increase  in  volume. 

^  AN   ACT    or    CONGRESS 

to  put  in  operation  this  plan  would  be  substantially  as  the  present  law  of 
June  3,  18G4.  The  department  of  the  controller  of  currency,  the  buieauof 
printing  and  engraving  would  remain  the  same. 

The  system  adopted  should  be  complete  in  itself,  it  should  be  as  broad 
as  the  United  States  in  its  effects,  it  should  be  planned  to  extend  through, 
the  centuries. 

While  by  one  depatment  it  gathered  in  the  money  annually  by  taxation 
and  revenues,  it  should  annually  return  the  money  to  the  people  equitably 
in  all  parts  of  the  nation,  seeking  to  collect  taxes  and  revenues  from  the 
rich,  and  largely  returning  it,  through  the  laboring  classes,  to  circulation. 

This  would  be  a  system  whereas  it  is  now  cnaos. 

THE  BILL. 

It  is  a  principle  in  law  that  legislative  enactments  should  use  as  much  of 
existing  laws  and  machinery  as  possible  in  order  to  produce  new  results. 
For  the  reason  that  we  are  familiar  with  what  has  been  in  use  and  know 
how  to  use  it. 

Operating  under  this  rule  I  have  taken  existing  laws  as  shown  by  the^ 
Act  of  June  3,  18G4  as  the  frame  work  of  a  new  or  complete  system  of 
finances  of  the  United  States  and  have  added  to  it  such  sections  and  parts 
of  a  section  as  will  produce  a  comprehensive  uniform  system  easily  under- 
stood and  easily  operated  by  those  familiar  with  existing  laws. 

The  system  embraces  the  use  of  all  of  our  American  out-put  of  gold  and 
silver  and  a  supplemental  volume  of  paper  money  sufficient  in  quantity  to 
safely  do  the  business  of  the  nation. 

The  abstract  gold  standard  of  value  now  in  operation  is  retained. 
Silver  is  to  be  bought  by  the  United  States  at  its  market  value  and  use 
either  by  coining  or  held  as  bullion  and  paper  money  issued  for  it. 

Any  difference  between  the  value  of  a  silver  dollar  and  a  gold  dollar  to 
be  paid  on  demand  by  the  United  States  by  receiving  silver  dollars  at  par 
for  gold  as  is  now  done. 


18 

The  paper  money  to  be  issued  by  autlioritj''  of  all  the  people,  backed  by 
the  wealth  of  all  the  people,  and  circulated  for  the  benefit  of  the  jieople. 

All  present  forms  of  paper  money  to  be  taken  up  by  the  new  issue,  uniform 
in  aj^iDearance,  thus  getting  rid  of  the  seven  or  eight  difPerent  kinds  of 
paper  money  in  circulation. 

A  brief  comment  on  each  section  of  the  bill  better  shows  what  can  and 
w^hat  can  not  be  done  under  is  provisions. 

Section.  1.  This  is  the  same  as  the  present  law  of  June  3,  1864.  It 
provides  for  the  office  and  appointment  of  a  comptroller  of  finances, 
who  is  the  same  as  our  present  comptroller  of  currency. 

Sec.  2.  Is  the  same  as  the  present  law.  It  provides  for  making  the 
seal  of  office  and  for  certified  copies  of  documents  in  the  office. 

Sec  3.  Is  the  unchanged  present  law  and  provides  for  office  room, 
vaults,  safes,  engraving  and  other  conveniences  for  the  transaction  of  the 
business  of  the  department. 

Sec  4.  This  in  addition  to  the  present  law  provides  for  the  issue  of  $20 
(or  any  other  sum)  per  capita  on  the  census  of  1890. 

This  with  gold  and  silver  would  give  about  |40  per  capita.  France 
uses  from  $42  to  $44.  It  is  a  small  country,  with  facilities  for  quick  tran- 
sit and  can  ship  money  from  one  point  to  another  in  a  few  hours,  to  meet 
sudden  demands. 

Whereas  with  us  the  area  is  so  great  that  money  can  not  be  readily  sent 
from  one  point  to  any  other  to  meet  sudden  large  demands.  In  my 
oi^inion  a  paper  issue  of  $25  per  capita  would  be  a  safer  amount. 

This  would  represent  only  about  2  cents  on  the  dollar  of  our  national 
wealth  of  some  3,400,000  square  miles  of  the  richest  land  in  the  world, 
which  with  the  wealth  of  the  people  is  estimated  at  $7]  ,000,000,000. 

This  would  be  safe  and  conservative  financering.  This  section  provides 
for  a  system  of  numbering  the  notes  issued  and  for  retaining  a  duplicate, 
canceled  copy  of  each  denomination,  for  detection  of  counterfeit.  There 
is  also  required  to  be  printed  on  the  face  of  each  note  a  statement  that  it 
must  be  surrendered  in  the  year  of  redemption  for  a  new  note  as  provided 
in  section  6. 

This  section  4  also  makes  gold  and  silver  coin  of  the  United  States  and 
these  notes  a  legal  tender  in  payment  of  all  public  and  private  obligations 
for  the  payment  of  money  in  the  United  States,  and  also  makes  them 
mutually  exchangeable  at  par  as  at  present  in  such  manner  as  shall  best 
subserve  the  public  interest. 

Sec  5.  The  same  as  the  present  law.  It  provides  for  taking  up  muti- 
lated notes  and  the  issue  of  the  new  ones  in  place  thereof;  and  that  notice 
thereof  be  published  for  the  i)ub]ic  benefit  in  the  Bulletin  of  Finances,  a 
monthly  to  be  published  by  the  Comptroller,  constantly  informing  the 
the  public  on  finances,  as  provided  in  section  33. 

Sec  G.  Is  mostly  a  new  section.  Every  twenty  years  it  requires  the 
whole  issue  of  paper  money  to  be  called  in  and  destroyed  and  also  that 


19 

"the  plates  and  dies  used  to  prodnce  it  shall  be  destroyed,  and  that  a  new 
issue,  from  new  plates  and  designs,  shall  be  put  into  circulation.  The  ob- 
ject of  this  is  to  ascertain  how  much  of  the  old  issue  is  lost  or  destroyed 
and  replace  it  by  a  new  issue  to  keep  up  the  volume.  It  is  also  designed 
to  destroy  the  circulation  of  all  counterfeit  money,  and  to  render  useless 
any  appliance  of  counterfeiters  for  counterfeiting  the  old  issue.  Under 
this  section  the  money  is  only,a  legal  tender  for  twenty  years,  after  that 
it  must  be  surrendered  and  canceled  by  the  new  issue. 

Sec.  7.  Is  entirely  new.  After  the  money  is  prepared  the  United  States 
can  not  give  it  away,  and  section  7  provides  for  putting  it  in  circulation 
The  new  issue  would  represent  from  ^1,240,000,000  to  $1,550,000,000. 

Of  this  sum  $534,088,802  would  be  used  to  take  up  the  present  paper 
money  of  the  United  States  and  national  bank  notes,  not  including  gold 
or  silver  certificates.  This  will  leave  from  1705,9)1,198  to  $1,015,911,198, 
as  the  issue  shall  be  |20  or  $25  per  capita. 

What  shall  be  done  with  this  vast  sum  ?  Section  7  further  provides  that 
the  United  States  may  buy  legally  issued  bonds  of  states,  counties  and  in 
corporated  cities  of  over  5000  inhabitants.  Such  bonds  to  be  issued 
for  not  to  exceed  5  per  cent  of  the  averaged  assessed  value  of  the 
property  for  the  preceding  five  years,  deducting  the  par  value  of  any 
outstanding  bonds.  These  bonds  to  be  issued  for  public  improve- 
ments, to  run  twenty  years  at  2  per  cent,  the  interest  j^ayable  an- 
nually, or  quarterly,  to  the  Comptroller  of  Finance  at  AVashington,  or  any 
sub-treasury,  a  proper  sinking  fund  to  be  provided.  The  public  issuance 
of  these  bonds  and  receipt  of  the  money  therefor  to  be  conclusive  evidence 
of  their  legal  issue,  and  a  bar  to  any  contest  of  their  validity.  These  bonds 
to  be  a  lien  on  the  property  until  paid  in  full.  Such  bonds  are  as  good  as 
any  United  States  bonds  ever  issued.  The  section  also  provides  that  the 
United  States  may  summarily  collect  the  principal  and  interest  if  any  de- 
fault is  made  in  payment  thereof. 

These  bonds  may  also  be  sold  by  the  Compi'oller  to  banks,  and  by  the 
banks  may  be  left  on  deposit  with  the  Comptroller  of  Finances,  as  a  basis 
on  which  the  banks  can  draw  at  any  time  money  to  use  in  their  business  as 
provided  in  section  12.  As  the  bonds  can  at  any  time  be  deposited  with 
the  United  States  and  the  par  value  drawn,  it  makes  a  practical  guarantee 
by  the  United  States  of  the  bonds. 

This  would  enable  l^anks  to  have  an  elastic  currency  in  all  parts  of  the 
United  States  perfectly  secured. 

Most  of  such  bonds  are  now  bearing  6  per  cent  interest.  This  plan  will 
save  4  per  cent,  and  the  taxpayers  would  have  that  much  less  taxes  to  raise. 

When  the  present  United  States  bonds  are  taken  up  it  will  save  tax- 
payers 4  per  cent  per  year  on  the  United  States  bonds.  In  addition  to  this 
the  states,  counties  and  cities  paying  2  per  cent  interest  to  the  United 
States  would  be  a  further  reduction  of  national  taxation.  This  depart- 
ment of  the  bill  will  save  millions  annually  to  the  taxpayers,  and  alone  is 
abundant  reason  for  the  passage  of  the  bill. 


20 

Under  this  section  of  the  bill  some  ^00,000,000  would  probably  be  used. 
Not  all  of  the  indebtedness  of  states,  counties  and  cities  would  be  taken  up 
under  this  section,  because  many  of  their  bonds  are  not  yet  due.  Under 
this  plan  the  government  ceases  to  be  a  borrower  of  money  but  through  it 
the  people  issue  their  own  money  as  a  whole,  and  thus  loan  it  to  localities 
of  their  fellow  citizens  who  must  borrow. 

This  will  save  paying  millions  of  interest  money  annually  to  foreigners 
for  the  use  of  their  money. 

Of  course  such  a  bill  will  receive  the  opposition  of  foreign  influence. 

This  would  place  the  banks  where  a  stringency  of  the  money  market 
could  never  occur,  as  from  any  part  of  the  United  States  banks  could  draw 
on  their  reserves  with  the  United  States  Treasury.  This  would  also  equal- 
ize interest  all  over  the  United  States. 

There  would  be  still  left  from  1300,000,000  to  $600,000,000,  not  used 
under  this  section,  which  would  be  placed  in  circulation  under  section  34,. 
which  will  be  commented  upon  under  that  section. 

Sections  8,  9,  10,  11,  12,  provide  that  the  owners  of  real  estate  may  in- 
corporate a  bank  and  place  the  title  in  fee  simple  absolute,  free  of 
encumberance  with  the  United  States  based  on  its  averaged  assessed 
value  for  the  preceeding  five  years.  The  lien  of  the  United  States  being 
paramount,  during  the  continuance  of  the  bank.  The  bank  can  use  this 
real  estate  as  a  reserve  security  with  the  same  effect  as  in  case  of  bonds, 
under  section  7,  up  to  its  averaged  assessed  value  for  the  preceeding  five 
years,  but  not  to  exceed  one-half  of  its  actual  value. 

Under  this  section  farmers  and  land  owners  can  receive  the  use  of  money. 
They  elect  their  own  officers,  form  a  bank  and  use  or  reloan  the  money  and 
when  not  needing  it  return  it  to  the  United  States  Treasury,  to  be  re- 
di'awn  and  used  when  required  during  the  20  years  of  the  bank's  exis- 
tence. This  plan  is  of  more  value  than  the  sub-treasury  plan,  and  avoids 
all  of  its  complications. 

If  the  real  estate  advances  or  depreciates  in  value  it  is  adjusted  under 
sections  17  and  18,  or  may  be  entirely  released. 

Sections  13,  14,  15,  16,  provide  the  present  mode  of  managing  such 
banks.     Under  section  19  National  Banks  may  loan  on  real  estate. 

Sec.  22.  Has  new  matter  in  it.  The  danger  of  a  low  rate  of  interest  is 
to  over-borrow,  and  thus  produce  speculation  and  cause  inflation  of 
business. 

To  avoid  this  section  22  provides  that  the  first  $100,000  drawn  by  any 
bank  shall  bear  2  per  cent  per  year  interest. 

This  with  the  ordinary  money  in  circulation  will  conduct  all  proper 
enterprises.  The  next  $100,000,  will  draw  3  per  cent  and  the  next  4  per 
cent,  and  so  on.  These  higher  rates  will  furnish  money  to  prevent  any 
stringency,  but  will  make  business  less  profitable,  forcing  the  curtailing 
of  business  gradually  without  destroying  it  as  at  present.  This  schedule 
of  increasing  interest  rate  is  one  that  the  best  judgment  of  the  people  can: 


21 

fix.  It  can  be  altered  at  any  time  when  experimenting  shows  the  need 
-of  it. 

This  is  the  natural  law  of  business  on  the  subject.  Germany  has 
recently  adopted  it.     All  banks  apply  the  same  rule. 

Sections  28  to  32  are  the  same  as  the  present  bank  law  and  need  no 
comments. 

Sec.  33.  This  is  a  new  section.  It  provides  for  the  monthly  pviblica- 
tion  of  a  "  Bulletin  of  Finances,  "  containing  concise  information  showing 
the  monthly  issue  of  currency,  showing  as  nearly  as  may  be  the  volume  of 
gold,  silver  and  currency  in  each  state  or  territory;  also  showing  the 
expenditures  of  the  government  in  each,  also  showing  the  essential  fact 
relating  to  the  condition  of  each  bank.  It  also  provides  for  the  proper 
distribution  of  these  bulletins. 

The  object  of  this  is  to  complete  the  efficiency  of  the  money  system  of 
the  United  States  and  furnish  to  the  people  correct  knowledge  on  current 
finances.  It  furnishes  the  foundation  knowledge  on  which  to  j)roperly 
execute  section  34. 

Sec,  34.  Is  of  very  great  importance.  Our  nation  today  has  no 
organized  method  for  redistributing  the  money  that  accumulates  in  the 
United  States  Treasury  from  revenue  and  taxes.  At  times  vast  sums  are 
stored  to  the  detriment  of  business;  and  the  cry  is  raised  "what  shall  we 
do  with  the  surplus.  " 

This  section  provides  that  in  addition  to  the  ways  provided  in  section 
7,  this  money  shall  be  spent  for  the  usual  expenses  of  the  government. 
And  that  the  government  shall  purchase  suitable  grounds  and  erect 
thereon  buildings  for  ^post-offices  and  other  public  use,  and  that  the 
expenditure  shall  be  made  annually  in  each  state  or  territory  in  proportion 
to  its  population.  Under  this  a  system  of  national  piiblic  improvements, 
such  as  on  the  Mississippi  Eiver  or  Nicuaragua  Canal,  or  irrigation  may 
be  carried  out. 

As  our  laws  now  are.it  is  very  difficult  to  get  any  government  building 
erected  except  in  certain  political  localities.  The  money  is  drawn  in 
from  the  jjeople  in  every  part  of  the  country  and  should  be  re-expended 
proportionately  among  them,  as  it  came  from  them.  It  is  not  a  charity 
for  the  government  to  spend  money  in  each  community.  That  is  where  it 
should  be  spent.  Every  city  and  village  should  have  a  respectable  and 
commodious   postoffice  building  erected  and  owned  hj  the  government. 

This  section  further  provides  that  this  public  work  shall  be  done  by 
day's  labor  at  say  $1.50  per  day,  for  common  labox\  The  object  is  this: 
First-class  laborers  always  command  higher  wages  from  private  capital, 
and  the  next  grade  of  labor  is  left  unemployed.  It  is  in  this  class  that  the 
sufPering  mostly  occur.  If  the  United  States  in  its  public  work  gives  em- 
ployment to  this  class  of  people  it  will  be  aiding  citizens  who  should  re- 
ceive the  care  of  the  stronger.  Such  laborers  can  not  for  various  reasons 
perform  as  much  work  per  day  as  the  best  laborers.  Public  buildings 
"would  cost  just  as  much,  or  even  more,  by  employing  this  class  than  by 


22 

employing  the  best  class.  But  the  object  of  any  government  shonld  not 
be  to  get  the  cheapest  results  in  a  specific  case,  but  should  be  for  the  gen- 
eral good.  This  class  of  labor  must  live.  If  labor  is  not  furnished  they 
must  beg  or  steal.  In  either  of  these  cases  the  public  must  bear  the  ex- 
pense. It  is  far  better  to  keep  up  the  tone  of  respectability  among  oiir 
people  by  furnishing  employment  and  paying  what  the  work  is  worth. 
Thus  instead  of  the  laboring  class  feeling  that  an  ever  widening  gap  ex- 
isted between  them  and  the  form  of  government,  they  would  feel  it  to  be 
their  friend  and  would  be  interested  in  maintaining  its  existence. 

And  here  in  protection  of  our  own  laborers  would  it  not  be  well  for 
our  own  government  to  close  its  doors  to  the  inllooding  of  foreign  labor. 
Why  shoTild  we  pay  foreigners  for  labor  and  let  our  own  citizens  go  idle  ? 
It  is  a  noted  fact  that  where  colonies  of  foreigners  get  control  of  local 
labor  that  the  American  laborer  finds  it  too  hot  for  him  to  remain. 

We  should  be  genei'ous,  but  we  should  not  be  so  generous  that  we  give 
our  employment  to  strangers,  and  drive  our  own  sons  and  daughters  of 
America  into  idleness,  shame  and  want.  If  our  legislative  halls  are  dom- 
inated by  such  a  foreign  sentiment  it  is  time  they  should  be  cleared  of  the 
un-American  element,  and  men  representing  the  American  idea  sent  to 
make  our  laws. 

In  conclusion  let  me  say  that  .the  people  should  demand  only  such  a 
money  system  as  will  do  justice  and  equity  to  all  the  people  and  all  classes. 
While  you  complain  of  being  overreached,  you  must  not  in  return  over- 
reach, or  do  injustice  to  others.  I  would  impress  upon  you  that  all 
schemes  for  a  national  system  of  finances,  that  are  based  on  the  idea  of 
giving  a  class  of  persons  or  banks  power  to  issue  or  control  the  issue  of 
money,  are  dangerous  and  sooner  or  later  will  be  abused.  Demand  a  con- 
stitutional Amendment,  and  a  law  that  issues  the  money  by  authority  of 
the  xteople,  hacked  by  the  pledged  wealth  of  the  whole  nation,  and  circu- 
lated for  the  benefit  of  all,  with  no  special  privilege  for  any  class,  and  in. 
volume  sufficient  to  fully  transact  the  business  of  our  growing  country. 


23 


Hereto  is  attached  a  copy  of  the  proposed  Bill,  which  of  course  will  re- 
ceive such  amendments  as  may  be  best. 

The  parts  in  brackets  show  where  this  Bill  differs  from  present  Act  of 
June  3,  18G4. 

A  BILL 

TO  PROVIDE    A     NATIONAL     CIRCULATING     MEDIUM,     AUD     TO     PROVIDE    FOR     THE" 

CIRCULATION    THEREOF. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the  United 
States  of  America  in  Congress  assembled  : 

That  there  shall  be  established  in  the  Treasury  Department  a  separate 
bureau  which  shall  be  charged  with  the  execution  of  this  and  all  other 
laws  that  may  be  passed  by  Congress  respecting  the  issue  and  circulatiou 
of  a  national  circulating  medium.  The  chief  officer  of  said  bureau  shall 
be  denominated  the  Comptroller  of  Finance,  and  shall  be  under  the 
general  direction  of  the  Secretary  of  the  Treasury.  He  shall  be  appointed 
by  the  President  of  the  United  States,  with  the  approval  of  the  Secretary 
of  the  Treasury,  by  and  with  the  consent  of  Congress,  and  shall  hold  his 
office  for  the  term  of  ten  years  unless  sooner  removed  by  the  President 
with  the  consent  of  Congress.  He  shall  receive  an  annual  salary  of  eight 
thousand  dollars;  he  shall  have  a  competent  deputy  appointed  by  the 
Secretary,  whose  salary  shall  be  three  thousand  live  hundred  dollars 
per  year,  who  shall  possess  the  power  and  perform  the  duties  of  the  Comp- 
troller during  a  vacancy  in  said  ofHce  or  during  the  absence  or  inability  of 
the  Comptroller.  The  Comptroller  shall  employ,  from  time  to,  time  the 
necessary  clerks  to  discharge  such  duties  as  he  shall  direct.  Such  clerks 
shall  be  classified  by  the  Comptroller,  subject  to  the  direction  of  the  Secre- 
tary of  the  Treasury,  which  clerks  shall  be  classified  in  the  manner  now  pre- 
scribed by  law. '  Within  fifteen  days  after  notice  of  his  appointment  "'le  shall 
take  and  subscribe  the  oath  of  office  prescribed  by  the  Constitution  and  the 
laws  of  the  United  States,  and  shall  give  to  the  United  States  a  bond  in  the 
penal  sum  of  one  hundred  thousand  dollars,  with  not  less  than  four  responsi- 
ble sureties,  to  be  approved  by  the  Secretary  of  the  Treasury,  conditional  for 
the  faithful  discharge  of  the  duties  of  his  office.  The  Deputy  Comptroller 
shall  also  take  oath  of  office,  and  give  a  similar  bond  in  the  simi  of  fifty 
thousand  dollars.  The  Comptroller  or  Deputy  Comptroller  shall  not, 
either  directly  or  indirectly,  be  interested  in  any  association  doing  a 
banking  business  under  this  act. 

Sec.  2.     And  be  it  further  enacted : 

That  the  Comptroller  of  Finance,  with  the  approval  of  the  Secretary  of 
the  Treasury,  shall  devise  a  seal,  with  suitable   inscriptions,  for  his  ottice 
•ft  description  of  which,  with  the  certificate  of    approval  by   the  Secretary 


24 

of  the  Treasury,  shall  be  tiled  in  the  office  of  the  Secretary  of  State,  with 
an  impression  thereof,  which  shall  thereupon  become  the  seal  of  office  of 
the  Comptroller  of  Finance,  and  the  same  may  be  renewed  when  neces- 
sary. Every  document  executed  by  the  Comptroller,  in  pursuance  of  any 
authority  conferred  on  him  by  law,  and  sealed  with  his  seal  of  office,  shall 
be  received  in  evidence  in  all  places  and  courts  whatsoever;  and  all  copies 
of  papers  in  the  office  of  the  Comptroller,  certified  by  him  to  be  correct 
copies  of  the  originals  in  his  office,  shall  in  all  cases  be  evidence  equally 
and  in  like  manner  as  the  originals.  An  impression  of  such  seal  directly 
on  the  paper  shall  be  as  valid  as  if  made  on  wax  or  wafer. 

Sec.  3.     And  be  it  further  enacted: 

That  there  shall  be  assigned  to  the  Comptroller  of  Finance,  by  the 
Secretary  of  the  Treasury,  suitable  rooms  in  the  Treasury  Building  for 
conducting  the  business  of  the  Bureau  of  Finance,  in  which  shall  be  safe 
and  secure  tire-proof  and  burglar-proof  vaults  in  which  it  shall  be  the 
duty  of  the  Comptroller  to  deposit  and  safely  keep  all  plates  not  neces- 
sarily in  the  possession  of  engravers  and  printers,  and  other  valuable 
things  belonging  to  his  department;  and  the  Comptroller  shall  fi'om  time 
to  time  furnish  the  necessary  furniture,  stationery,  fuel,  light  and  other 
proper  conveniences  for  the  transaction  of  said  business. 

Sec    4.     And  be  it  further  enacted: 

That  the  Comptroller  of  Finance,  under  the  direction  of  the  Secretary 
of  the  Treasury,  is  hereby  authorized  and  directed  to  issue  a  circulating 
medium  in  the  name  of  the  United  States  of  America  [to  the  amount  of 
f  20,  in  addition  to  gold  and  silver  coin,  per  capita  of  the  population  of 
the  censiis  of  1890.  Upon  ascertaining  each  following  census  the  issue 
shall  be  increased  to  said  |20  j^er  capita].  In  order  to  furnish  suitable 
notes  for  circulation  the  Comptroller  of  Finance  is  hereby  authorized 
and  required,  under  the  direction  of  the  Secretary  of  the  Treasury,  to 
cause  plates  and  dies  to  be  engraved,  in  the  best  manner  to  guard  against 
counterfeitimg  and  fraudulent  alterations,  and  to  have  printed  therefrom, 
on  paper  or  similar  material  best  adapted  therefor,  and  numbered,  the 
quantity  of  circulating  notes,  of  the  denominations  of  one  dollar,  two  dol- 
lars, five  dollars,  ten  dollars,  twenty  dollars,  fifty  dollars,  one  hundred 
dollars  and  five  hundred  dollars,  as  may  l^e  required  to  supply  the  issue 
hereia  called  for.  [The  number  of  each  denomination  in  use  shall  be  such 
that  the  needs  of  the  people  shall  be  best  subserved  thereby.  The  notes 
of  each  denomination  shall  be  consecutively  numbered.  That  a 
duplicate  of  each  denomination  and  from  each  successive  plate  used 
shall  be  perforated  with  the  word  "  duplicate,"  and  carefully  pre- 
served for  use  in  the  identification  of  the  originals,  and  for  the  detection 
of  counterfeits,  l)y  comparison  therewith.  Said  notes  shall  express  on 
their  face  that  they  are  issued  by  the  (government  of  the  United  States  of 
America  as  the  circulating  medium  of  the  people  of  the  United  States. 
They  shall  have  the  wi'itten  or  engraved  signatures  of  the  Secretary  of 
the  Treasury,  and  of  the  CoJiiptroller  of  Finance,  and  the  imprint  of  the 
seal  of  the  Treasury,  and  shall  bear  such  other  statements  and  devices  as 
the  Secretary  of  the  Treasury  shall  direct,  and  shall  contain  a  statement 
that  "This  note  must  be  surrended  to  the  Comptroller  of  Finance  in. 
■exchange  for  a  new  note  of  similar  denomination  during  the  year"  (stating 


25 

the  year  for  retiring  the  same).  Said  notes,  and  gold  and  silver  coin  of 
the  United  States,  shall  be  received  at  par,  in  payment  of  all  obligations 
within  the  jurisdiction  of  the  United  States  for  the  payment  of  money. 
The  monetary  nse  of  gold  and  silver  coin  of  the  United  States  nnder 
existing  laws  is  not  hereby  interfered  with,  and  said  notes,  gold  and  silver 
coin  shall  be  exchangeable  at  their  par  value,  in  such  manner  as  shall  best 
subserve  the  interests  of  the  people.] 

Sec  5.     And  be  it  further  enacted: 

That  it  shall  be  the  duty  of  the  Comptroller  of  Finance  to  receive  worn 
out  and  nnitilated  circulating  notes  issued  hereunder,  and  with  the 
Secretary  of  the  Treasury  the  Comptroller  of  Finance  shall  compare  said 
notes  with  the  duplicates  thereof  on  tile,  and  when  satisfied  that  the 
same  are  the  originals  issued  under  this  act,  they  shall  be  destroyed  by 
"being  burned  to  ashes  in  the  presence  of  the  Secretary  of  the  Treasury 
and  the  Comptroller  of  Finance  and  such  other  person  as  the  President 
shall  designate.  A  permanent  book  of  record  of  the  destruction  of  such 
notes,  with  sufficient  descriptions  thereof,  shall  be  kept  by  the  Comp- 
troller of  Finance  and  published  in  the  Bulletin  of  Finance.  After  said 
destructions  of  said  notes,  new  notes  of  the  same  denominations  and 
number  shall  be  issued  to  the  owners  of  the  destroyed  notes,  of  which 
duplicates  shall  be  kept  as  hereinbefore  provided.  Such  new  notes  shall 
^be  marked  second  series  or  third  series  as  the  case  may  be. 

Sec.  6.     And bp  it  further  enacted: 

[That  in  the  year  following  each  second  census,  beginning  with  the  cen- 
sus of  1910,  the  entire  issue  of  circulating  notes  shall  be  retired  and 
•destroyed  as  provided  in  section  5  herein.  And  iinder  the  provisions  of 
this  act  a  new  issue  shall  be  made  from  new  dies  and  plates  and  with  new 
•designs,  and  shall  be  substituted  for  the  retired  notes,  and  during  the 
year  for  retiring  said  notes  each  banking  institiition  doing  business  here 
under,  shall  during  the  months  of  January,  February,  March  and 
April  forward  to  the  Comptroller  of  Finance  at  least  25  per  cent  each  month 
of  said  notes  in  its  possession,  and  in  exchange  therefor  the  Comptroller 
of  Finance  shall  issue  the  new  notes  of  the  same  denomination.  During 
the  remaining  months  of  the  year  each  of  said  banking  institutions  shall 
monthly  forward  all  of  the  old  issue  of  notes  it  may  have  or  receive  to  the 
Comptroller  of  Finance  for  destruction  and  exchange.  During  said 
remaining  months  of  said  year  for  retiring  said  old  issue  any  person  or 
corporation  may  forward  notes  of  the  old  issue  for  destruction  and 
exchange  to  the  Comptroller  of  Finance.  After  the  expiration  of  the 
said  year  for  the  retiring  said  old  issue  of  notes,  the  said  old  issue  shall 
'  cease  to  be  lawful  money  of  the  United  States,  and  shall  only  be  received 
by  the  Comptroller  of  Finance  for  destruction  and  exchange,  and  shall  be 
so  received  until  the  outstanding  old  issue  is  entirely  retired  and 
destroyed.]  The  dies  and  plates  used  in  producing  the  old  issue  of  notes 
shall  be  destroyed  by  fusing  in  fire  in  January  of  each  year  of  retiring,  in 
the  presence  of  the  Secretary  of  the  Treasury,  the  Comptroller  of  Finance, 
and  some  person  appointed  by  the  President.  A  record  of  the  destruction 
.of  said  plates  shall  be  kept  in  the  office  of  the  Comptroller  of  Finance. 

Sec.  7.     And  be  it  further  enacted : 

[That  for  the  purpose  of  putting  said  notes  in  circulation  the  Comp- 
troller of  Finance  shall  be  authorized  to  retire  all   outstanding:   notes   or 


26 

currency  of  the  United  States,  and  to  buy  and  legally  issued  bonds  of  the 
states,  counties,  and  incorporated  cities  of  over  5.000  inhabitants,  as 
he  deems  proper,  said  bonds  ^o  be  issued  by  said  states,  counties  and 
cities,  for  a  valuation  not  to  exceed  five  per  cent  of  the  average 
assessed  value  of  the  real  estate  in  said  state,  county,  or  city,  for 
the  five  years  preceding  the  issuance  of  said  bonds,  deducting  from  the 
the  said  issue  of  bonds  the  par  value  of  any  other  outstanding  bonds 
issued  by  said  state,  county  or  city.  '  Said  bonds  shall  be  a  lien  on 
all  real  estate  in  said  state,  county  or  city,  and  shall  bear  interest 
at  the  rate  of  two  per  cent  per  year,  and  shall  not  run  to  exceed  twenty 
years.  The  interest  shall  be  payable  annually  to  the  Comptroller  of 
Finance  at  V\  ashington,  and  a  sinking  fund  shall  be  provided  in  each 
case  sufficient  to  liquidate  said  bonds  at  or  before  maturity.  The  public 
issuance  of  such  bonds,  their  delivery  to  the  Comptroller  of  Finance,  and  the 
receipt  of  the  circulating  notes  therefor  shall  be  deemed  conclusive  evidence 
of  the  legal  issuance  and  validity  of  said  bonds,  and  thereafter  no  defense 
shall  be  set  up  to  the  payment  of  principal  or  interest,  or  to  the  levying 
and  collecting  of  taxes  therefor.  All  objections  or  defense  to  the  issue  of 
said  bonds  must  be  made  by  the  parties  interested  prior  to  the  delivery 
thereof  to  the  Comptroller  of  Finance,  otherwise  they  are  forever  waived 
and  barred  as  a  defense.  Said  bonds  may  be  sold  by  the  Comptroller,  and 
such  bonds  or  any  United  States  bonds  may  be  deposited  at  par  as  reserve 
security  by  banks  in  the  same  manner  as  provided  for  real  estate  herein. 
If  said  state,  county,  or  city  shall  fail  or  neglect  at  any  time  to 
levy  and  collect  a  sntficient  tax  to  meet  the  obligations  of  said  bonds,  there 
shall  be  immediately  due  and  payable  to  the  Comptroller  of  Finance  a 
tax  on  the  real  and  personal  property  in  said  state,  county,  or  city 
in  default  on  its  last  assessment  roll  suificient  to  meet  said  pay- 
ments and  costs  of  collecting  the  same;  and  the  same  shall  be  collected 
by  any  person  or  persons  appointed  therefor  by  the  Comptroller  of 
Finance,  who  shall  have  power  where  said  tax  is  not  paid  within  thirty 
days  after  it  is  levied  to  collect  the  same  by  seizure  and  sale  iipon  war- 
rant issued  by  any  judge  ex  parte  of  any  court  of  original  jurisdiction, 
State  or  national  having  jurisdiction  of  the  property.  The  United  States 
may  become  the  purchaser  of  such  property.  Redemption  may  be 
made  within  one  year  after  sale  by  paying  the  amount  due  on  the  sale,^ 
costs  and  interest  thereon  at  ten  per  cent.  Provided  that  no  bonds  shall 
be  purchased  hereunder  except  such  as  by  state  laws  are  made  subject  to 
the  terms  of  this  act.] 

Sec.  8.     And  be  it  further  enacted: 

That  associations  for  carrying  on  the  business  of  banking  may  be 
formed  by  any  number  of  persons,  not  less  in  any  case  than  five,  who  shall 
enter  into  articles  of  association,  which  shall  specify  in  general  terms  the 
proposed  name  of  the  association,  the  object  for  which  the  association  ia 
formed,  and  the  proposed  capital  stock ;  and  may  contain  any  other 
provisions  not  inconsistent  with  the  provisions  of  this  act,  which  the 
association  may  see  fit  to  adopt  for  the  regulation  of  the  business  of  the 
association  and  the  conduct  of  its  afl'airs,  which  said  articles  shall  be  ■ 
signed  by  the  persons  uniting  to  form  the  association,  and  a  copy  of  them 
forwarded  to  the  Comptroller  of  Finance,  to  be  filed  and  preserved  in  his. 
oflfice.  Attached  to  said  articles  of  association  shall  be  a  schedule  [of  the 
bonds  or  real  estate  offered  and  known  as  "the  reserve  security"  as  herein 
provided  for,  which  schedule  shall  accurately  describe  said  bonds,  and 
real  estate  and  the    improvements    thereon,    stating  in  whom  the  title  is; 


27 

vested  in  fee  simple  absolute,  free  of  all  incumbrances  or  liens,  and  giving 
the  yearly  assessed  value  of  said  real  estate  for  each  separate  year  for  state 
and  county  purposes  for  the  live  preceding  years,  which  schedule  shall  be 
certified  to  as  correct  by  the  proper  keeper  of  the  records  of  title  of  said 
property.  Upon  receipt  of  said  articles  and  schedule,  the  Comptroller  of 
Finance  shall  proceed  in  whatever  manner  he  deems  best  to  verify  the 
facts  set  out  in  said  schediile;  and  when  satisfied  that  the  average  assessed 
value  for  said  live  years  next  preceding  is  not  in  excess  of  half  of  the  actual 
valiie  of  said  real  estate,]  and  that  the  schedule  is  otherwise  correct  as  to 
its  statements,  he  shall  notify  said  persons  of  that  fact  of  the  name 
approved  by  him  for  the  association. 

Sec.  9.     And  be  it  further  enacted: 

That  the  person^  uniting  to  form  such  an  association  shall  make  a 
certificate  of  organization,  which  shall  specify: 

First.  — The  name  assumed  by  the  association. 

Second.  — The  place  where  its  operations  of  discount  and  deposit  are  to 
be  carried  on,  designating  the  state,  territory  or  district,  and  also  the 
particular  county  and  city,  town  or  village. 

Third.  — Its  capital  stock,  and  the  number  of  shares  into  which  it  shall 
be  divided. 

Fourth.  — The  names  and  places  of  residence  of  the  shareholders,  and 
the  number  of  shares  held  by  each. 

Fifth.  — An  accurate  copy  of  the  schedule  of  [bonds  or  real  estate 
attached]  to  the  articles  of  association  provided  for  in  section  8. 

Sixth.  ^A  declaration  that  said  certificate  is  made  to  enable  such 
persons  to  avail  themselves  of  the  advantages  of  this  act,  and  that  said 
[real  estate  is  for  security  as  required  in  this  act.] 

The  said  certificate  shall  be  duly  signed  and  acknowledged  by  each  of 
said  persons,  in  the  manner  required  by  the  law  of  the  place  for 
acknowledging  conveyances  of  real  estate,  to  entitle  them  to  be  recorded. 
[When  duly  certified  therefor  said  certificate  shall  be  recorded  in  the 
properbook  of  record  of  the  county  or  district  m  which  the  real  estate  is 
situated;  thereafter  no  lien  or  claim  shall  attach  to  any  of  said  real  estate, 
except  such  as  shall  be  wholly  subordinate  to  the  prior  claim  under  said 
certificate  against  said  real  estate  for  the  purposes  of  this  act.]  When 
duly  recorded  the  said  certificate  shall  be  transmitted  to  the  Comptroller 
of  Finance,  who  shall  record  and  carefully  preserve  the  same  in  his  office. 
Copies  of  said  certificate,  duly  certified  by  the  Comptroller  of  Finance  and 
authenticated  by  his  seal  of  office,  shall  be  legal  and  sufficient  evidence  in 
all  courts  and  places  within  the  jurisdiction  of  the  Government  of  the 
United  States  of  the  existence  of  said  association  and  of  every  other  mat- 
ter that  could  be  proved  by  the  production  of  the  original  certificate. 

Sec.  10.     And  be  it  further  enacted: 

[That  no  association  shall  be  organized  hereunder  with  a  "reserve 
security  "  greater  than  one  million  dollars,  or  with  a  less  "  reserve  security" 
than  twenty-five  thousand  dollars,  nor  with  a  capital  stock  of  less  than 
fifty  thousand  dollars.] 

Sec.  11.     And  be  it  further  enacted: 

That  whenever  a  certificate  of  organization  has  been  received  and  filed 


28 

by  the  Comptroller  of  Finance,  and  is  found  by  him  to  fully  comply  with 
the  requirements  of  this  act,  the  Comptroller  of  Finance  shall  proceed  to 
investigate  in  the  manner  deemed  best,  the  personal  standing,  financial 
condition  and  record  of  the  persons  seeking  to  form  the  association,  [also 
the  object  of  the  association,  the  location  and  value,  present  and  pros- 
pective, of  the  real  estate  described  in  said  certificate  of  organization,  and 
any  other  facts  that  may  aid  him  in  determining  the  desirability  of  such 
an  association  and  the  probable  safety  of  its  business  affairs  and  manage' 
ment.  The  Comptroller  of  Finance  may  use  such  special  means  as  he 
deems  best  to  safely  ascertain  the  facts  above  refered  to.  When  it  shall 
appear  to  the  satisfaction  of  the  Comptroller  of  Finance  that  the  association 
is  lawfully  entitled  to  commence  the  business  of  banking  with  safety  to 
the  government  and  to  the  people,  he  shall  issue  to  such  association  a 
certificate  under  his  hand  and  official  seal  that  such  association  has  com- 
plied with  all  the  provisions  of  this  act  required  to  be  complied  with,  and 
that  such  association  is  authorized  to  commence  the  business  of  banking, 
designating  the  place  of  business,  fully  naming  the  directors  and  officers 
thereof  for  the  first  year  and  its  capital  stock.  The  said  certificate  shall 
be  published  in  such  local  newspaj^er  for  sixty  days,  as  the  Comptroller 
of  Finance  shall  designate.  From  the  date  of  said  certificate  said  asso- 
ciation shall  be  deemed  a  body  corporate  to  transact  the  business  of 
banking  hereunder,  with  the  usual  rights,  powers  and  duties  of  banking 
corporations,  and  shall  exist  for  the  period  of  twenty  years.  An  impress 
of  its  corporate  seal  shall  be  tiled  with  the  Comptroller  of  Finance  and 
with  the  Secretary  of  the  Treasury. 

Sec.  12.     And  be  it  further  enacted : 

[That  thereafter,  upon  the  demand  of  said  association,  the  Comptroller  of 
Finance  shall  issue  to  said  association  a  warrant  on  the  Treasury  of  the 
United  States,  for  circulating  notes  of  the  Government  to  the  amount  of 
the  said  average  assessed  value  of  real  estate,  or  the  par  value  of  said 
bonds  deposited  by  said  bank,  or  for  any  part  thereof,  as  demanded  from 
time  to  time,  which  warrants,  upon  presentment  duly  endorsed,  shall  be 
paid  out  of  the  Treasury  in  the  notes  issued  hereunder.  Said  sum  or  any 
part  thereof  may,  on  the  first  of  any  quarter  of  the  year,  be  returned  to 
the  Treasury.] 

Sec.  13.     And  be  it  further  enacted: 

That  the  affairs  of  all  associations  for  banking  purposes  formed  here- 
under shall  be  managed  by  its  board  of  directors,  which  may  be  in  legal 
session  on  any  Monday  from  10  a.  m.  wherein  a  quorum  is  present,  and  on 
any  other  day  where,  after  notice,  a  quorum  may  be  present,  or  to  which 
a  regular  session  may  be  adjourned,  a  quorum  being  present. 

Every  director  shall  be  a  citizen  of  the  United  States  during  his  whole 
term  of  service;  and  at  least  three-fourths  of  the  directors  shall  have  re- 
sided in  the  state  or  territory  or  district  in  which  such  association  is 
located  one  year  next  preceding  their  election  or  appointment  as  directors, 
and  shall  be  residents  thereof  during  their  term  of  office.  Each  director 
shall  own  in  his  own  right  at  least  ten  shares  of  the  capital  stock  of  the 
.  association.     Each  director,  when  elected  or  appointed,  shall  take  an  oath 


29 

that  he  will,  so  far  as  the  duty  devolves  upon  him,  diligently  and  honestly 
administer  the  affairs  of  such  association,  and  will  not  knowingly  violate, 
or  willingly  permit  to  be  violated,  any  of  the  provisions  of  this  act,  and 
that  he  is  the  bona  tide  owner  in  his  own  right  of  ten  shares  of  the  capital 
stock  of  the  association,  standing  in  his  own  name  on  the  books  of  the 
association,  and  that  the  same  is  not  hypothecated  or  in  any  way  pledged 
as  security  for  any  loan,  debt  or  obligation;  which  oath  subscribed  by 
him  and  duly  certified,  as  required  by  law,  shall  be  immediately  trans- 
mitted to  the  Comptroller  of  Finance  and  by  him  filed  and  preserved  in 
his  office. 

Sec.  14    And  be  it  further  enacted: 

That  the  directors  of  any  association  first  appointed  shall  hold  office 
until  their  successors  shall  be  elected  and  qualified.  All  elections  shall ibe 
held  on  the  second  [Tuesday  of  January  of  each  year,]  and  the  directors  as 
elected  shall  hold  their  places  until  their  successors  are  elected  and 
qualified.  Any  vacancy  occuring  by  reason  of  a  director  ceasing  to  own 
the  required  amount  of  stock,  or  from  any  other  cause,  shall  be  filled  by 
appointment  by  the  board.  If  from  any  cause  an  election  shall  not  be 
held  at  the  time  designated,  it  may  he  held  on  any  subsequent  day  by 
publishing  thirty  days'  notice  thereof  in  a  local  daily  paper. 

Sec.  15.     And  be  it  further  enacted: 

That  in  all  meetings  of  the  stockholders  each  shax'e  of  stock  shall  be 
entitled  to  one  vote  on  all  questions.  Shareholders  may  vote  by  proxies 
duly  authorized  in  writing.  None  but  shareholders  can  use  or  hold  a 
a  proxy, 

Sec.  16.     And  be  it  further  enacted: 

That  the  shares  of  stock  may  be  transferred  on  the  books  of  the  associa- 
tion in  such  manner  as  may  be  prescribed  in  the  by-laws  of  the  association. 
No  transfer  shall  be  made  of  stock  where  the  holder  is  indebted  to  the 
association  in  any  manner;  but  the  association  has  a  lien  on  all  of  its 
stock  for  such  indebtedness.  Every  person  becoming  a  shareholder  by 
transfer,  or  otherwise,  shall,  in  proportion  to  his  shares,  succeed  to  all  the 
rights  and  liabilities  of  the  prior  holder  of  such  shares,  and  no  change 
shall  be  made  in  the  articles  of  association  by  which  the  rights,  remedies 
and  securities  of  the  existing  creditors  of  the  association  shall  be  impaired. 
The  shareholders  of  each  association  formed  under  the  provisions  of  this 
act,  and  of  each  exisiting  bank  or  banking  association  that  may  accept  the 
provisions  of  this  act,  shall  be  held  individually  responsible,  equally  and 
ratably,  and  not  one  for  the  other,  for  all  contracts,  debts  and  engagements 
of  such  associations  to  the  extent  of  the  amount  of  their  stock  therein,  at 
par  thereof,  in  addition  to  the  amount  invested  in  such  shares. 

Sec.  17.     And  be  it  further  enacted : 

That  the  capital  stock  or  the  reserve  security  of  any  association  formed 
hereunder  may  be  increased  or  decreased  within  the  limits  fixed  for  the 
capital  stock  or  [the  reserve  security]  by  this  act  by  a  two-thirds  vote  of 
its  shareholders  at  any   annual  meeting  in  January.     The  increase  or  de 


30 

crease  of  capital  stock  or  the  [reserve  seeuritj']  shall  be  made  by  complying 
with  the  requirements  of  this  act  as  to  the  formation  of  such  associations 
in  the  first  instance,  and  by  complying  with  such  additional  requirements 
as  the  Comptroller  of  Finance  may  deem  best  to  secure  the  interests  of 
all  parties  concerned,  provided  |  that  in  the  decrease  of  the  reserve  security 
the  association  so  decreasing  its  reserve  security  shall  surrender  to  the 
Comptroller  of  Finance  circiilating  notes  received  thereon  to  the  amount 
of  the  decrease.  In  such  cases  the  Comptroller  of  Finance  may,  in  his 
discretion,  release  from  the  effect  of  this  act  a  pro  rata  of  the  bonds  or 
real  estate  described  in  the  certificate  of  organization,  but  this  shall  only 
be  done  in  cases  where  the  Comptroller  of  Finance  shall  find  the  asso- 
ciation to  be  solvent.  The  maximum  or  minimum  of  such  increase  or 
decrease  shall  be  determined  by  the  Comptroller  of  Finance.] 

Any  association  organized  hereunder  may  close  up  its  business  and  dis- 
solve its  organization  by  a  Vote  of  its  stockholders  had  at  the  annual 
meeting  in  January.  In  such  cases  the  association  must  first  settle  all 
of  its  outstanding  obligations  and  return  to  the  Comptroller  of  Finance 
the  circulating  notes  received  on  its  reserve  security.  The  Comptroller  of 
Finance,  upon  receipt  of  a  statement  of  the  foregoing  facts  duly  authen- 
ticated by  the  directors  of  said  association  udder  oath,  shall  fully  inves- 
tigate the  matters  pertaining  thereto;  and  upon  being  satisfied  that  all 
obligations  of  said  association  are  fully  satisfied  and  discharged,  shall 
cause  said  statement  to  be  published  for  at  least  sixty  days  in  a  local 
newspaper,  and  shall  also  cause  a  notice  thereof  to  be  inserted  in  the 
[United  States  Bulletin  of  Finance]  for  the  same  period.  If  any  objections 
to  the  dissolution  are  filed  with  the  Comptroller  of  Finance  before  the 
expiration  of  said  sixty  days,  he  shall  determine  and  adjust  any  matters 
therein  objected  to;  when  so  adjusted,  or  if  no  objections  are  filed  with 
him,  he  shall  issue  a  certificate  dissolving  said  association  and  releasing 
the  bonds  or  real  estate  described  in  the  certificate  of  organization  from 
any  further  claim  or  demand  thereon.  Said  certificate  of  dissolution 
shall  be  by  him  duly  signed,  sealed  and  acknowledged  so  as  to  entitle  the 
same  to  record  in  the  office  whett'e  the  certificate  of  organization  was 
recorded.  The  Comptroller  of  Finance  shall  duly  record  said  certificate 
of  dissolution  in  his  office,  and  thereafter  shall  transmit  the  same  to  said 
association  upon  the  same  being  duly  recorded  in  the  office  where  the 
certificate  of  organization  was  recorded.  The  association  will  thereby  be 
completely  dissolved. 

Sec.  18.     And  be  it  further  enacted: 

[That  if  at  any  time  the  value  of  the  real  estate  described  in  the  certifi- 
cate of  organization  shall  depreciate  in  value,  to  be  decided  by  the  Comp- 
troller of  Finance,  he  may  require  any  portion  of  the  circulating  notes  of 
the  association's  reserve  security  to  be  surrendered  to  the  Comptroller  of 
Finance,  or  he  may  require  further  real  estate  security  as  in  the  original 
formation  of  the  association.]  Should  the  Comptroller  of  Finance  at  any 
time  deem  the  afPair  of  said  association  unsafe  from  any  cause,  he  may 
appoint  a  special  agent  or  agents  under  his  hand  and  seal  of  office,  who 
shall  have  power  to  inspect  all  afPairs  of  said  association  and  to  close  up  its 
affairs  to  the  best  possible  advantage  to  all  parties  interested.     To  this  end 


31 

be  sliall  have  power  to  bring  or  defend  any  siiit  in  the  name  of  the  association, 
and  to  sell  at  public  or  private  sale  any  or  all  of  the  real  estate  described 
in  the  certificate  of  organization,  and  to  execute  proper  conveyances 
thereof,  and  use  the  proceeds  to  close  up  the  affairs  of  the  association. 
He  shall  also  have  power  to  collect  from  the  stockholders  the  amount  for 
which  they  are  responsible  under  this  act,  and  to  use  the  same  to  close  up 
the  accounts.  He  shall  give  such  bonds  for  faithful  performance  of  his 
duties  hereunder  as  the  Comptroller  of  Finance  may  require.  His  certifi- 
cate of  appointment  shall  be  duly  acknowledged  and  recorded  as  the 
other  certificates  are  required  to  be.  The  Government  shall  be  a  preferred 
creditor  in  all  such  cases  as  are  provided  for  in  this  section. 

Sec.  19.     And  be  it  further  enacted: 

That  the  directors  may  semi-annually  declare  dividends  from  the  net 
profits  of  the  association,  but  such  association  before  it  shall  declare  a 
dividend  shall  cairy  at  least  ten  per  cent  of  its  net  profits  to  a  reserve 
fund  until  said  reserve  fund  shall  equal  the  capital  stock  of  said  association. 

Sec.  20.     And  be  it  further  enacted: 

That  it  shall  be  lawful  for  any  association  hereunder  to  purchase,  hold 
and  convey  real  estate  as  follows : 

First. — Such  as  shall  be  necessary  for  its  immediate  accommodation  in 
the  transaction  of  its  business  and  [for  its  reserve  security.] 

Second. — Such  as  shall  be  mortgaged  to  it  in  good  faith  by  way  of 
security  for  debts  previously  contracted  or  [for  loans  made  thereon.] 

Third. — Such  as  shall  be  conveyed  to  it  in  satisfaction  of  debts  pre- 
viously incurred  in  the  course  of  its  dealings. 

Fourth. — Such  as  it  shall  purchase  at  sales  under  judgments,  decrees, 
or  mortgages  held  by  the  association,  or  shall  purchase  to  secure  debts 
due  to  said  association 

Such  association  shall  not  i^urchase  or  hold  real  estate  for  any  other 
purpose  than  as  herein  specified.  Provided  that  all  such  real  estate  ac- 
quired other  than  for  the  purpose  of  the  business  of  the  association  shall 
be  sold  within  five  years  after  it  is  obtained  by  the  association 

Sec  21.     And  be  it  further  enacted: 

That  each  association  may  charge  such  rates  of  interest  as  may  be 
allowed  by  local  laws  where  the  association  is  situated.  Each  association 
shall  keep  on  hand  in  cash  an  amount  equal  to  at  least  twenty-five  per 
cent  of  the  amount  of  its  deposits,  when  the  reserve  amount  shall  fall 
below  said  percentage.  No  more  dividends  or  loans  shall  be  made  until 
the  amounts  called  in  shall  restore  the  said  percentage. 

Sec.  22.     And  be  it  further  enacted: 

That  every  association  hereunder  shall  make  to  the  Comptroller  of 
Finance  a  report,  according  to  the  form  which  may  be  prescribed  by  him, 
verified  by  the  oath  or  affirmation  of  the  president  or  cashier  of  such  as- 
sociation, which  report  shall,  among  other  things,  exhibit  in  detail,  and 
under  appropriate  heads,  the  resources  and  liabilities  of  the  association, 
and  [the  last  assessment  valuation  of  its  real   estate,]  before  the  com- 


32 

mencement  of  business  on  the  morning  of  the  first  Monday  of  the  months 
of  January,  April,  July  and  October  of  each  year,  and  shall  transmit  the 
same  to  the  Comptroller  of  Finance  within  five  days  thereafter.  And  any 
bank  failing  to  transmit  such  report  shall  be  subject  to  a  penalty  of  one 
thousand  dollars  for  each  day  after  said  five  days  that  said  report  is  dela3"ed 
beyond  that  time.  The  Comptroller  shall  cause  abstracts  of  said  reports  to 
be  published  in  the  United  States  Bulletin  of  Finance,  and  the  separate  re- 
port of  each  association  shall  be  published  by  the  association  in  a  local  daily 
newspaper  for  at  least  one  week.  [Said  association  shall  forward,  with 
each  quarterly  report,  one-half  C|)  of  one  per  cent,  of  the  cash  used  on  its 
reserve  security,  during  the  preceding  quarter,  as  interest  thereon,  on 
sums  not  to  exceed  S10u,000,  and  three-fourths  of  one  per  cent,  per  quarter 
on  sums  in  excess  of  iplOO,OOU  and  less  than  $200,000;  thereafter  tlie  rate 
shall  increase  one-fourth  of  one  per  cent,  per  quarter  additional  on  each 
additional  $100,000  used  or  on  any  part  thereof;]  and  in  case  of  default  in 
the  payment  thereof,  by  any  associatiou,  said  interest  may  be  collected 
in  the  manner  provided  for  the  collection  of  United  States  duties  of  other 
corporations.  In  addition  to  the  quarterly  reports  required  herein,  every 
association  shall,  on  the  first  Tuesday  of  each  month,  make  to  the  Comp- 
troller of  Finance  a  statement  under  oath  of  the  president,  or  the  cashier, 
showing  the  condition  of  the  association  making  such  statement,  ia 
respect  to  the  average  amount  loans  and  discounts,  specie  and  circulating 
notes  on  hand  belonging  to  the  association,  Clearing  House  certificates,, 
deposits,  and  such  other  matters  as  the  Comptroller  of  Finance  may 
require. 

Sec.     23.     And  be  it  further  enacted: 

That  no  association  shall  make  loans  or  discount  on  the  security  of  the 
shares  of  its  own  capital  stock,  nor  be  the  purchaser  or  holder  of  any  such 
shares  unless  such  security  or  purchase  shall  be  necessary  to  prevent  loss 
upon  a  debt  previously  contracted  in  good  faith ;  and  stock  so  purchased 
or  acquired  shall  be  sold  within  six  months  from  the  time  of  its  purchase- 
But  no  such  purchase  or  sale  shall  relieve  the  former  owner  thereof  from 
his  pro  rata  of  responsibility  for  all  debts  incurred  by  the  association 
prior  to  sale  and  transfer  to  a  new  purchaser  in  good  faith. 

Sec.     24.     And  be  it  further  enacted: 

That  no  association,  or  any  member  thereof,  shall,  during  the  time  it 
shall  continue  its  banking  operations,  withdraw,  or  permit  to  be  with- 
drawn, either  in  the  form  of  dividends  or  otherwise,  any  portion  of  its 
capital  or  reserve  fund.  And  if  any  losses  shall  at  any  time  have  been 
sustained  by  any  such  association,  equal  to  or  exceeding  its  undivided 
profits  then  on  hand  in  cash,  no  dividend  shall  be  made;  and  no  dividend 
shall  ever  be  made  by  any  association,  while  it  shall  continue  its  banking 
operations,  to  an  amount  greater  than  its  net  profits  then  on  hand,  de- 
ducting therefrom  its  losses  and  bad  debts  and  ten  per  cent  for  the 
reserve  fund.  And  all  debts  due  any  association,  on  which  the  interest  is 
past  due  and  unpaid  for  a  period  of  six  months,  unless  the  same  shall  be 
well  secured  and  shall  be  in  process  of  collection,  shall  be  considered  bad 
debts  within  the  meaning  of  this  act. 


33 

Sec.     25.     And  be  it  further  enacted : 

That  the  president  and  cashier  of  every  such  association  shall  cause  tcr 
be  kept  at  all  times  a  full  and  correct  list  of  the  names  and  residences  of 
all  the  shareholders  in  the  association,  and  the  number  of  shares  held  by- 
each,  in  the  ofHce  where  its  business  is  transacted  ;  and  such  list  shall  be 
subject  to  public  inspection  during  business  hours  of  each  day  in  which 
business  may  be  legally  transacted.  A  copy  of  said  list  shall  be  sent  with 
each  quarterly  report  to  the  Comptroller  of  Finance. 

Sec.     26.     And  be  it  further  enacted : 

[That  the  directors  of  any  bank  incorporated  under  any  national  or 
state  law  may,  upon  the  authorization  of  the  owners  of  two-thirds  the  cap- 
ital stock,  in  writing,  duly  signed  and  acknowledged,  avail  themselves  of 
the  provisions  of  this  act  and  become  a  national  association  under  their 
corporate  name  by  complying  with  the  provisions  of  this  act.]  The  said 
directors  being  by  said  vote  authorized  to  execute  all  papers  relating 
thereto.  Any  matters  not  herein  provided  for  in  such  cases  shall  be  ad- 
justed by  the  Comptroller  of  Finance  in  accordance  with  the  spirit  and 
intention  of  this  act. 

Sec.     27.     And  be  it  further  enacted: 

That  all  associations  under  this  act,  when  designated  for  that  purpose 
by  the  Secretary  of  the  Treasury,  shall  be  depositaries  of  public  money, 
except  receipts  from  customs,  under  such  regulations  as  may  be  prescribed 
by  the  Secretary;  and  they  may  also  be  employed  as  financial  agents  of 
the  Government;  and  they  shall  perform  all  such  reasonable  duties,  as 
depositaries  of  public  moneys  and  financial  agents  of  the  Government,  as 
may  be  required  of  them.  And  the  Secretary  of  the  Treasury  shall  re- 
quire of  the  association  thus  designated,  satisfactory  security  for  the 
safe  keeping  and  prompt  payment  of  public  funds  deposited  with  them, 
and  for  the  faithful  performance  of  their  duties  as  financial  agents  of 
the  Government. 

Sec.     28.     And  be  it  further  enacted : 

That  all  transfers  of  the  assets  or  any  part  thereof,  of  any  association 
doing  business  hereunder,  made  after  the  commission  of  an  act  of  insol- 
vency, or  in  comtemplation  thereof,  with  a  view  to  prevent  the  application 
of  it  as  assets  in  the  manner  prescribed  in  this  act,  or  with  a  view  to  the 
preference  of  one  creditor  to  another,  shall  be  utterly  null  and  void. 

Sec.     29.    And  be  it  further  enacted: 

That  any  director,  ofiicer  or  employee,  of  any  association  organized 
hereunder,  who  shall  knowingly  violate,  or  permit  any  of  such  persons  to 
violate  the  provisions  of  this  act,  shall  be  removed  forthwith  from  his 
position,  by  the  proper  authority  of  the  association,  or  by  order  of  the 
Comptroller  of  Finance.  And  any  director,  ofiicer  or  employee  of  such 
association  who  shall  so  transact  the  business  of  such  association,  or  any 
part  of  it,  as  to  intentionally  defraud  the  association  or  any  one  else,  or 
with  the  intention  to  deceive  or  mislead  any  officer  of  the  association,  or 
any  agent  appointed  to  examine  the  affairs  of  such  association,  shall  be 


34 

deemed  guilty  of  a  misdemeanor,  and   upon   conviction   thereof  shall  be 
punished  by  imprisonment  for  nor  more  than  ten  years. 

Sec.     30.     And  be  it  further  inacted: 

That  all  suits  and  proceedings  arising  out  of  the  provisions  of  this  act, 
in  which  the  United  States  or  its  agents  or  officers  shall  be  parties,  shall 
be  conducted  by  the  district  attorneys  of  the  several  districts,  under  the 
direction  and  supervision  of  the  Solicitor  of  the  Treasury,  And  that  all 
suits  or  actions  arising  under  the  provisions  of  this  act,  may  be  had  in 
any  circuit,  district  or  territorial  court  of  the  United  States  held  vs^ithin 
the  district  in  which  the  association  may  be  established,  or  in  any  state, 
county  or  municipal  court  in  the  jurisdiction  of  which  said  association  is 
established,  which  has  jurisdiction  in  similar  cases. 

Sec.     31.     And  be  it  further  enacted: 

That  if  any  person  shall  falsely  make,  forge  or  counterfeit,  or  cause  or 
procure  to  be  made,  forged  or  counterfeited,  or  willing  aids  or  assists  in 
forging  or  counterfeiting  any  note  in  imitation  of,  or  purporting  to  be  in 
imitation  of  the  circulating  notes  issued  under  the  provisions  of  this  act, 
or  shall  pass,  utter  or  publish,  or  attempt  to  pass,  utter  or  publish,  any 
false,  forged  or  counterfeited  note  purporting  to  be  issued  under  the  pro- 
visions of  this  act,  knowing  the  same  to  be  falsely  made,  forged  or  counter- 
feited, or  shall  falsely  alter,  or  cause  or  procure  to  be  falsely  altered,  or 
willingly  aids  or  assists  in  falsely  altering  any  such  circulating  notes 
issued  under  the  provisions  of  this  act,  or  shall  pass,  utter  or  publish,  or 
attempt  to  pass  utter  or  publish  as  true,  any  falsely  altered  or  spurious 
circulating  notes  issued,  or  purporting  to  have  been  issued  under  the  pro- 
visions of  this  act,  knowing  the  same  to  be  falsely  altered  or  spurious, 
every  such  person  shall  be  deemed  and  adjudged  guilty  of  a  felony,  and 
being  thereof  convicted  shall  be  sentenced  to  be  imprisoned  and  kept  at 
hard  labor  for  a  period  of  not  less  than  five  years  nor  more  than  twenty 
years,  and  fined  in  a  sum  not  exceeding  one  thousand  dollars. 

Sec.  32.     And  be  it  further  enacted: 

That  if  any  person  shall  make  or  engrave,  or  cause  or  procure  to  be  made 
or  engraved,  or  shall  have  in  his  custody  or  possession  any  plate,  die  or 
block  after  the  similitude  of  any  plate,  die  or  block  from  which  any  circu- 
lating notes  issued  as  aforesaid  shall  have  been  prepared  or  printed,  with 
intent  to  use  such  plate,  die  or  block,  or  cause  or  suffer  the  same  to  be 
used  in  forging  or  counterfeiting  any  of  the  notes  issued  as  aforesaid,  or 
shall  have  in  his  custody  or  possession  any  blank  note  or  notes  engraved 
and  printed  after  the  similitude  of  any  notes  issued  as  aforesaid  with 
intent  to  use  such  blanks,  or  cause  or  suffer  the  same  to  be  used  in  forging 
or  counterfeiting  any  of  the  notes  issued  as  aforesaid,  or  shall  have  in  his 
custody  or  possession  any  paper  adapted  to  the  making  of  such  notes,  and 
similar  to  the  paper  upon  which  any  such  notes  shall  have  been  issued, 
with  intent  to  use  such  paper,  or  cause,  or  suffer  the  same  to  be  used  in 
forging  or  counterfeiting  any  of  the  notes  issued  as  aforesaid,  every  such 
person,  being  thereof  convicted  by  due  course  of  law,  shall  be  sentenced  to 


35 

be  imprisoned  and  kept  at  hard  labor  for  a  terra  not  less  than  iive  or  more 
than  twenty  years,  and  lined  in  a  sum  not  exceeding  one  thousand  dollars. 

Sec.  88.     And  be  it  further  enacted: 

I  That  the  Comptroller  of  Finance  shall  cause  to  be  prepared  each 
month  concise  information  showing  the  amount  of  circulating  notes  issued 
during  the  preceding  month,  and  the  approximate  amount  of  circulating 
notes,  gold  and  silver  coin,  in  each  state,  territory,  district,  and  in  the  prin- 
cipal cities  of  the  United  States,  and  also  the  amount  in  the  various  vaults 
or  Treasuries  of  the  United  States.  Also  the  amounts  expended  by  the 
Government  in  each  state,  territory  or  district.  It  shall  also  contain  the 
name  of  each  bank,  the  amount  of  its  capital  stock,  its  reserve  fund,  and 
its  lossfes  for  the  preceding  month,  and  such  other  information  as  shall  be 
deemed  of  sufficient  value  to  the  financial  interest  of  the  people  to  be 
published.  Such  information  shall  be  published  monthly  by  the  Depart- 
ment of  Printing  in  pamphlet  form,  of  convenient  size  for  permanent 
binding  in  book  form.  One  copy  of  each  issue  shall  be  sent  monthly  to 
each  of  the  following  parties:  To  each  association  doing  business  here- 
under, to  the  President  and  each  member  of  his  Cabinet,  to  each  member 
of  Congress,  and  to  such  other  officers  of  the  Government  as  the  Comp- 
troller of  Finance  may  direct.  Also  to  the  Governor  of  each  state,  terri- 
tory or  district,  and  to  each  public  library,  university  or  college  applying 
therefor.  Any  person  may  have  a  copy  forwarded  to  his  address  for  one 
year  by  first  forwarding  to  the  Comptroller  of  Finance  the  sum  of  one 
dollar.  All  subscriptions  shall  end  with  the  December  number  of  each 
year.  Subscriptions  made  during  the  year  shall  be  at  the  rate  of  ten  cents 
per  copy  for  the  remaining  months  of  the  year.] 

Sec.  84.     And  be  it  further  enacted: 

[That  as  the  circulating  medium  shall  accumulate  in  the  Treasury  of  the 
Government  from  revenue  or  otherwise,  it  shall  be  returned  to  circulation 
among  the  people  in  addition  to  the  ways  hereinbefore  specified,  by  pay- 
ing the  current  expenses  of  the  Government;  by  the  purchase  of  suitable 
grounds  and  the  erection  thereon  of  suitable  buildings  for  post  offices  and 
other  uses  of  the  Government;  by  the  construction  of  such  other  works  as 
shall  be  deemed  by  Congress  for  the  best  interests  of  the  public.  The 
expenditures  shall  be  made  annually,  in  each  state,  territory  or  district  as 
nearly  as  may  be,  in  proportion  to  the  number  of  its  inhabitants,  provided 
that  states  already  supplied  with  public  buildings  shall  not  receive  addi- 
tional expenditures  until  the  other  states,  territories  or  districts  shall 
have  had  their  equal  proportions.  All  public  work  shall  be  done  by  day's 
labor,  at  the  rate  of  one  dollar  and  fifty  cents  per  day  for  eight  hours  work 
for  common  labor.  A  less  rate  shall  be  paid  where  the  laborer  is  not  able  to 
perform  a  reasonable  day's  work.  The  expenditures  hereunder  shall  be 
as  directed  from  time  to  time  by  Congress.] 

Sec.     35.     And  be  it  further  enacted : 

That  all  notes  issu.ed  hereunder  and  all  moneys  received  by  the  Comp- 
troller of  Finance  hereunder  shall  be  deposited  in  the  Treasury  of  the 
United  States.  And  the  Comptroller  of  Finance  shall  keep  an  itemized 
account  of  the  sources  from  which  received,  with  the  dates  thereof. 

Sec.     36.    And  be  it  further  enacted: 

[That  all  improvements  on  property  described  in  the  certificate  of 
organization  shall  be  kept  insured  by  the  association  to  the  full  amount  of 
its  assessed  value,  payable  to  the  Comptroller  of  Finance,  and  all  insur- 
ances on  such  property,  in  whatever  name  insured,  shall,  in  case  of   loss, 


36 

be  paid  by  the  insurance  company  to  the  Comptroller  of  Finance,  to  be  by 
hi_a  disposed  of,  with  the  consent  of  the  Secretary  of  the  Treasury,  as 
they  may  deem  best  in  the  interest  of  the  various  parties  concerned.] 

Sec.     37.     And  be  it  further  enacted: 

That  it  shall  be  unlawful  for  any  officer  acting  under  the  provisions  of 
this  act  to  countersign  or  deliver  to  any  association,  or  to  any  other  com- 
pany or  person,  any  circulating  notes  contemplated  by  this  act,  except 
as  herein  provided,  and  in  accordance  with  the  true  intent  and  meaning 
of  this  act.  A.nd  any  officer  who  shall  violate  the  provisions  of  this  section 
shall  be  deemed  guilty  of  a  high  misdemeanor,  and  on  conviction  thereof 
shall  be  punished  by  a  fine  not  exceeding  double  the  amount  so  counter- 
signed and  delivered,  and  imprisoned  for  not  less  than  one  year  and  for 
not  exceeding  fifteen  years. 

Sec.     38.     And  be  it  further  enacted: 

That  if  the  directors  of  any  association  shall  knowingly  violate,  or 
knowingly  permit  any  of  the  officers,  agents  or  servants  of  the  association 
to  violate  any  of  the  provisions  of  this  act,  all  the  rights,  privileges  and 
franchises  of  the  association  derived  from  this  act  shall  be  thereby  for- 
feited. Such  violation  shall  be  first  determined  and  adjudged  by  a  proper 
circuit,  district,  or  territorial  court  of  the  United  States,  in  a  suit  brought 
for  that  purpose  in  the  name  of  the  Comptroller  of  Finance,  which  decree 
shall  adjudge  the  association  dissolved.  Thereupon  the  afPairs  of  the 
association  shall  be  closed  up  by  the  Comptroller  of  Finance,  and  in  case 
of  such  violation,  every  director  who  participated  in  or  assented  to  the 
same  shall  be  held  liable  in  his  personal  and  individual  capacity  for  all 
damages  which  the  association,  its  shareholders,  or  any  other  person  shall 
have  sustained  in  consequence  of  such  violation.  Such  directors  shall 
thereafter  be  disqualified  for  the  office  of  director  in  any  association 
formed  hereunder ;  and  any  president,  director,  cashier,  teller,  clerk  or 
agent  of  any  association  who  shall  embezzle,  abstract  or  wilfully  misapply 
any  of  the  moneys,  funds  or  credits  of  the  association,  or  shall,  without 
authority  from  the  directors,  issue  or  put  forth  any  certificate  of  deposit, 
draw  any  order  or  bill  of  exchange,  make  any  acceptance,  assign  any  note 
bond  or  draft,  bill  of  exchange,  mortgage,  judgment  or  decree,  or  shall 
make  any  false  entry  in  any  book,  report  or  statement  of  the  association, 
with  intent  in  either  case  to  injure  or  defraud  the  association,  or  anv  other 
company,  body  politic  or  corporate,  or  any  individual  person,  or  to  deceive 
any  officer  of  the  association,  or  any  agent  apointed  to  examine  the  affairs 
of  any  such  association,  shall  be  deemed  guilty  of  a  misdemeanor,  and 
upon  conviction  thereof  shall  be  punished  by  imprisonment  not  less  than 
one  and  not  more  than  ten  years. 

Sec.  39.     And  be  it  further  enacted : 

That  the  Comptroller  of  Finance,  with  the  approbation  of  the  Secretary 
of  the  Treasury,  as  often  as  shall  be  deemed  necessary  or  proper,  shall 
appoint  a  suitable  person  or  persons  to  make  an  examination  of  the  affairs 
of  very  banking    association  formed    hereunder,  which  person  or  peions 


37 

shall  not  be  a  director  or  other  officer  or  employee  in  any  association 
whose  affairs  he  shall  be  appointed  to  examine,  and  who  shall  have 
power  to  make  a  thorough  examination  into  all  the  affairs  of  the 
association,  and,  in  doing  so,  to  examine  any  of  the  officers 
and  agents  thereof  on  oath,  and  shall  make  a  full  detailed 
report  of  the  condition  of  the  association  to  the  Comptroller. 
And  the  association  shall  not  be  subject  to  any  other  visitorial  powers 
than  such  as  are  authorized  by  this  act,  except  such  as  are  vested  in  the 
several  courts  of  law  and  chancery.  And  every  person  appointed  to  make 
such  examination  shall  receive  for  his  services  at  the  rate  of  five  dollars 
for  each  day  employed  by  him  in  such  examination,  and  two  dollars  for 
each  twenty-five  miles  he  shall  necessarily  travel  in  the  performance  of 
his  duty. 

Sec.  40.     And  be  it  further  enacted : 

That  persons  holding  stock  as  executors,  guardians,  administrators  or 
trustees  shall  not  be  personally  subject  to  any  liabilities  as  stockholders, 
but  the  estates  and  funds  in  their  hands  shall  be  liable  in  like  manner 
and  to  the  same  extent  as  the  testator,  intestate,  ward,  or  person  interested 
in  said  trust  funds  would  be  if  they  were  respectively  living  and  competent 
to  act  and  hold  the  stock  in  their  own  names. 

Sec.  41.     And  be  it  further  enacted : 

[That  hereafter  no  national  associations  for  the  purpose  of  banking 
shall  be  formed  except  under  the  provisions  of  this  act,  and  all  banking  in- 
stitutions now  under  the  provisions  of  prior  acts  of  Congress  shall  be 
allowed  to  continue  under  such  acts  until  their  proper  term  of  existence 
has  expired.] 

Sec.  42.     And  be  it  further  enacted : 

[That  the  present  Comptroller  of  Currency  shall  hereafter  be  known  as 
the  Comptroller  of  Finance,  under  this  act,  and  under  such  name,  shall 
with  the  bureau  now  established,  perform  all  duties  required  under  the 
various  acts  of  Congress  relating  to  currency  or  a  circulating  medium  ] 

Sec.  43.     And  be  it  further  enacted: 

That  all  acts  or  parts  of  an  act  in  conflict  with  the  provisions  of  this 
act  ai^e  hereby  repealed,  and  Congress  may  at  any  time  amend,  alter  or 
repeal  this  act. 


39 


INDEX 

A  Corner  on  Money 3 

A  Political  Forecast 3 

The  Stringency  of  Money : 4 

The  Crash  for  Want  of  Money 4 

The  Financial  Situation ...  5 

Stringency  More  Apparent  5 

A  Glut  of  $20,000,000 6 

The  Financial  Vacuum 6 

The   Demand 7 

Growth  of  Civilization 7 

International   Demand 8 

Call  Loans 8 

Volume  Required 9 

Not  Enough  Gold  and   Silver 10 

What  is  the  Remedy 10 

Not  Free  Coinage     10 

Free  Coinage  not  an  Issue 11 

Fifty  Year  2  per  cent  Bonds 12 

Clearing  House  Plan 12 

Farmers'  Aliance  Scheme 13 

Suggested  Legislature 14 

A  Constitutional  Amendment  Needed 14 

Proposed  Amendment 15 

As  Good  as  Gold 16 

Gold  and  Silver  Basis 17 

An  Act  of  Congress 17 

Proposed  Legislation 17 

Copy  of  Proposed  Bill 23 


40 


Los  Angeles,  June,  1891 
The  actual  volume  of  money  in  the  United  States  is: 

Gold $694,869,680 

Silver 485,370,397 

Legal  tender  paper  renewed 420,272,225 


$1,600,512,402 

Senator  Stewart  says  in  the  June  Forum,  "The  addition  to  our  circu- 
lating medium  up  to  the  present  time  which  free  coinage  would  have 
caused  could  not  have  exceeded  fifteen  million  dollars;"  and  "The  most 
serious  objection  to  metallic  money  is  the  want  of  a  sufficient  supply." 

Free  coinage  is  only  a  drop  in  the  bucket,  and  can  never  replace  the 
necessity  of  a  vast  volume  of  paper  money,  which  is  now  over  $420,000,000 
unsecured. 

The  only  sufficient  and  safe  system  is  to  place  all  of  the  above  gold  and 
silver,  and  all  other  real  and  personal  property  in  the  United  States 
(pledged  by  a  constitutional  amendment)  back  to  an  issue  of  say  $2,500,- 
000,000,  interchangeable  legal  tender  money,  issued  under  a  uniform 
system  for  the  benefit  of  all,  and  free  from  the  monopoly  of  any  set  of 
men  or  corporations. 

The  need  of  the  hour  is  courageous  statesmen  who  will  give  the  United 
States  the  best  money  system  possible,  free  from  all  rings,  large  or  small. 


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